Eight independent situations are described below. Each involves future deductible amounts and/or future taxable amounts: ($ in millions) Temporary Differences Reported First on: The Income Statement The Tax Return RevenueExpense RevenueExpense1. $40 2.$40 3. $40 4. $40 5.35 40 6. 40 35 7.35 40 30 8.35 40 25 30 Required:For each situation, determine taxable income, assuming pretax accounting income is $300 million.

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Eight independent situations are described below. Each involves future deductible amounts and/or future taxable amounts:

	($ in millions)
	Temporary Differences Reported First on:
	The Income Statement		The Tax Return
	Revenue	Expense		Revenue	Expense
1.			$40
2.	$40
3.						$40
4.							$40
5.	35		40
6.			40			35
7.	35		40				30
8.	35		40			25	30

Required:
For each situation, determine taxable income, assuming pretax accounting income is $300 million.

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