$ 232,000 2,320,000 Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2022, it reported financial statement income after taxes of $1,558,800. Timpanogos provided the following information relating to its 2022 activities: 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 2022 Rental income payments received in 2021 but earned in 2022 Rental income payments received in 2022 but not earned by year-end Tax depreciation Book Depreciation Net capital loss Federal income tax expense for books in 2022 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. 24,200 208,800 348,000 46,400 52,200 18,200 11,600 34,800 63,000 28,200 48,400 359,600
$ 232,000 2,320,000 Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2022, it reported financial statement income after taxes of $1,558,800. Timpanogos provided the following information relating to its 2022 activities: Life insurance proceeds as a result of CEO's death Revenue from sales (for both book and tax purposes) Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. Charitable contributions Cost of goods sold for book and tax purposes Interest income on tax-exempt bonds Interest paid on loan obtained to purchase tax-exempt bonds Rental income payments received and earned in 2022 Rental income payments received in 2021 but earned in 2022 Rental income payments received in 2022 but not earned by year-end Tax depreciation Book Depreciation Net capital loss Federal income tax expense for books in 2022 Required: a. Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. b. Identify each book-tax difference as either permanent (P) or temporary (T). c. Complete Schedule M-1 for Timpanogos. d. Compute Timpanogos Incorporated's tax liability. 24,200 208,800 348,000 46,400 52,200 18,200 11,600 34,800 63,000 28,200 48,400 359,600
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter5: Business Deductions
Section: Chapter Questions
Problem 2BCRQ
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Question
Transcribed Image Text:$ 232,000
2,320,000
Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2022, it reported financial statement income after
taxes of $1,558,800. Timpanogos provided the following information relating to its 2022 activities:
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 2022
Rental income payments received in 2021 but earned in 2022
Rental income payments received in 2022 but not earned by year-end
Tax depreciation
Book Depreciation
Net capital loss
Federal income tax expense for books in 2022
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.
24,200
208,800
348,000
46,400
52,200
18,200
11,600
34,800
63,000
28,200
48,400
359,600
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