Consider a non-current liability that has resulted in a tax liability forFalko Inc. in its 2018 financial statements. Assuming there are no other(current) tax liabilities or assets, Falko's 2018 tax liabilities will beclassified as:(a) non-current in the statement of financial position.(b) current in the statement of financial position.(c) non-current in the statement of comprehensive income.(d) current in the statement of comprehensive income.

Understanding Deferred Tax LiabilitiesA deferred tax liability (DTL) arises when there are temporary…

Answered: Consider a non-current liability that…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 28CE

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1. The amount of income taxes that relate to financial income subject to tax is reported on the income statement as A. long-term deferred income taxes (credit) C. income tax expense B. current deferred income taxes (debit) D. income tax payable 2. An item that would create a permanent difference in pretax financial and taxable income would be A. using accelerated depreciation for tax purposes & straight line depreciation for book purposes. B. using the percentage of completion method on long-term construction contracts. C. purchasing equipment previously leased with an operating lease in prior years. D. paying fines for violation of laws. 3. Which of the following is the most likely item to result in a deferred tax asset? A. using completed contract method of recognizing construction revenue tax purposes, but using percentage of completion method for financial reporting purposes. B. using accelerated depreciation for tax purposes but straight-line depreciation for accounting purposes.…
Cooper Investments reported an unusual gain from the sale of certain assets in its 2020 income statement. How does intraperiod tax allocation affect the reporting of this unusual gain?
Which of the following circumstances created a future taxable amount?
LMNO Corporation was formed in 2011. It reported net income (loss) over the 2011 through 2017 tax years, before accounting for any net operating losses, as follows: 2011 2012 2013 2014 2015 2016 2017 Required: a. Determine annual taxable income after accounting for any net operating losses for 2011 to 2017, assuming the corporation does not waive the carryback period. Also determine any NOL carryforward to 2018 b. Determine annual taxable income after accounting for any net operating losses for 2011 to 2017, assuming the corporation waive the carryback period. Also determine any NOL carryforward to 2018. Note: For all requirements, leave no cells blank - be certain to enter "0" wherever required. 2011 2012 2013 2014 2015 $ (3,000) $ 16,300 $ 26,200 $(18,900) $ 18,500 $(9,100) $ 5,650 Year 2016 2017 2018 carryforward Answer is not complete. Taxable income Part b Part a $ $ $ ›› 01 0 $ $ 13,300 $ 26,200 OS 0 $ S 00$ $ 5,6506 $ S 00 * 3 *** 3 0 0 0
Which of the following is not a disclosure required by PAS 12 Income Taxes? Group of answer choices Details of deferred tax assets Any adjustments of taxes of prior periods Tax consequences of future dividend payments Disclosure on the face of the statement of financial position about current tax assets, current tax liabilities, deferred tax assets, and deferred tax liabilities
Definitions The FASB has defined several terms in regard to accounting for income taxes. Below are various code letters (for terms) followed by definitions. 1. The deferred tax consequences of future deductible amounts and operating loss carryforwards 2. A difference between the tax basis of an asset or liability and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of the asset or liability is recovered or settled, respectively 3. Temporary difference that results in taxable amounts in future years when the related asset or liability is recovered or settled, respectively 4. The future effects on income taxes, as measured by the applicable enacted tax rate and provisions of the enacted tax low, resulting from temporary differences and operating loss carryforwards at the end of the current year 5. The change during the year in a corporations deferred tax liabilities and assets 6. The deferred tax consequences of future taxable amounts 7. The portion of o deferred tax asset for which it is more likely than not that a tax benefit will not be realized 8. Temporary difference that results in deductible amounts in future years when the related asset or liability is recovered or settled, respectively 9. The sum of income tax payable and deferred tax expense (or benefit) 10. The amount of income taxes paid or payable (or refundable) for the current year 11. An excess of tax deductible expenses over taxable revenues in a year that may be carried forward to reduce taxable income in a future year 12. The excess of taxable revenues over tax deductible expenses and exemptions for the year 13. Income tax expense divided by income before income taxes
Cooper Investments reported an unusual gain from thesale of certain assets in its 2017 income statement. Howdoes intraperiod tax allocation affect the reporting of thisunusual gain?
In relation to accounting for income taxes, which one of the following statements is correct? a. Tax expense is the sum of current tax expense plus deferred tax expense. b. All movements in deferred tax assets and liabilities are recognised in the statement of profit or loss and other comprehensive income. c. Current tax expense is the sum of tax expense plus deferred tax expense. d. Deferred tax liabilities are determined from deductible temporary differences.
analyze disclosures relating to deferred tax items and the eff ective tax rate reconciliation,and explain how information included in these disclosures aff ects a company’s fi nancialstatements and fi nancial ratios;
1. cont... Listed below are items that are commonly accounted for differently for financial reporting purposes than they are for tax purposes.For each item below, indicate whether it involves: 1. A temporary difference that will result in future deductible amounts and, therefore, will usually give rise to a deferred income tax asset. 2. A temporary difference that will result in future taxable amounts and, therefore, will usually give rise to a deferred income tax liability. 3. A permanent difference. (e) Installment sales of investments are accounted for by the accrual method for financial reporting purposes and the installment method for tax purposes. (f) For some assets, straight-line depreciation is used for both financial reporting purposes and tax purposes, but the assets’ lives are shorter for tax purposes. (g)…
describe the diff erences between accounting profi t and taxable income, and defi ne key terms,including deferred tax assets, deferred tax liabilities, valuation allowance, taxes payable, andincome tax expense;
For each of the following subsequent (post-balance-sheet) events, indicate whether a company should (a) adjust the financial statements, (b) disclose in notes to the financial statements, or (c) neither adjust nor disclose. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. Subsequent (Post-Balance-Sheet) Events Settlement of federal tax case at a cost considerably in excess of the amount expected at year-end. Introduction of a new product line. Loss of assembly plant due to fire. Sale of a significant portion of the company's assets. Retirement of the company president. Prolonged employee strike. Loss of a significant customer. Issuance of a significant number of shares of common stock. Material loss on a year-end receivable because of a customer's bankruptcy. Hiring of a new president. Settlement of prior year's litigation against the company (no loss was accrued). 12. Merger with another company of comparable size. < < < <

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