$ 222,000 2,220,000 23,200 199,800 333,000 44,400 49,950 17,200 11,100 33,300 60,500 27,200 46,400 344,100 Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2023, it reported financial statement income after taxes of $1,491,050. Timpanogos provided the following information relating to its activities for the year. Life insurance proceeds as a result of CEO's death Revenue from sales (for both book and tax purposes) Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. Charitable contributions Cost of goods sold for book and tax purposes Interest income on tax-exempt bonds Interest paid on loan obtained to purchase tax-exempt bonds Rental income payments received and earned in 2023 Rental income payments received in 2022 but earned in 2023 Rental income payments received in 2023 but not earned by year-end Tax depreciation Book Depreciation Net capital loss Federal income tax expense for books Required: a. Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. b. Identify each book-tax difference as either permanent (P) or temporary (T). c. Complete Schedule M-1 for Timpanogos. d. Compute Timpanogos Incorporated's tax liability.
$ 222,000 2,220,000 23,200 199,800 333,000 44,400 49,950 17,200 11,100 33,300 60,500 27,200 46,400 344,100 Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2023, it reported financial statement income after taxes of $1,491,050. Timpanogos provided the following information relating to its activities for the year. Life insurance proceeds as a result of CEO's death Revenue from sales (for both book and tax purposes) Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. Charitable contributions Cost of goods sold for book and tax purposes Interest income on tax-exempt bonds Interest paid on loan obtained to purchase tax-exempt bonds Rental income payments received and earned in 2023 Rental income payments received in 2022 but earned in 2023 Rental income payments received in 2023 but not earned by year-end Tax depreciation Book Depreciation Net capital loss Federal income tax expense for books Required: a. Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. b. Identify each book-tax difference as either permanent (P) or temporary (T). c. Complete Schedule M-1 for Timpanogos. d. Compute Timpanogos Incorporated's tax liability.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Transcribed Image Text:$ 222,000
2,220,000
Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2023, it reported financial statement income after
taxes of $1,491,050. Timpanogos provided the following information relating to its activities for the year:
Life insurance proceeds as a result of CEO's death
Revenue from sales (for both book and tax purposes)
Premiums paid on the key-person life insurance policies. The policies have no cash surrender value.
Charitable contributions
Cost of goods sold for book and tax purposes
Interest income on tax-exempt bonds
Interest paid on loan obtained to purchase tax-exempt bonds
Rental income payments received and earned in 2023
Rental income payments received in 2022 but earned in 2023
Rental income payments received in 2023 but not earned by year-end
Tax depreciation
Book Depreciation
Net capital loss
Federal income tax expense for books
Required:
a. Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the
adjustments necessary to arrive at taxable income.
b. Identify each book-tax difference as either permanent (P) or temporary (T).
c. Complete Schedule M-1 for Timpanogos.
d. Compute Timpanogos Incorporated's tax liability.
23,200
199,800
333,000
44,400
49,950
17,200
11,100
33,300
60,500
27,200
46,400
344,100
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