ense 110,000 Depreciation expense for tax purposes 120,000 c. Compute the net increase in BDI’s deferred tax
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Beaver Dam Inc. (BDI) listed the following items to prepare a reconciliation between book and taxable income.
GAAP net income before tax $700,000
Meal and entertainment expense 100,000
GAAP
Depreciation expense for tax purposes 120,000
c. Compute the net increase in BDI’s
d. Prepare the
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- On December 31, for GAAP purposes, Clubs Inc. reported a balance of $56,000 in Prepaid Maintenance Expense for services to be received over the following year. For tax purposes, however, prepaid costs are deducted when paid. Taxable income is $184,000 and the tax rate is 25%. Assume no other temporary differences or any beginning balances in deferred tax accounts. Required a. Record the income tax journal entry on December 31. •Note: If a line in a journal entry isn't required for the transaction, select "N/A" as the account names and leave the Dr. and Cr. answers blank (zero). Date Account Name Dec. 31 Income Tax Expense N/A Income Tax Payable Deferred Tax Liability To record income tax expense Dr. Cr. 60,000 0 0 0 0 46,000 ▼ 0 14,000 b. Prepare the income tax section of the income statement for the year and provide the disclosure of current and deferred tax expense. •Note: Do not use negative signs with your answers. Partial Income Statement For the year ended December 31 Income…Mami Co. computed a pre-tax financial income of 15,000,000 for the year ended Dec. 31, 201X. In preparing the tax return, the following differences are noted between financial income and taxable income. Non-deductible Expense 2,000,000 Non-taxable revenue 1,000,000 Estimated warranty cost that was recognized as expense in 200X but deductible for tax purposes when paid 1,500,000 Excess tax depreciation over financial depreciation 500,000 What is the current tax expense for 201X if the tax rate is 32%?a. Compute for Daniel's pre-tax accounting profit for the years 2020, 2021, 2022, and 2023. b. Compute for the belance of deferred tax liability at the end of 2020, 2021, 2022, and 2023. c. Prepare journal entries for current income taxes and deferred income taxes for years 2020, 2021, 2022, and 2023.
- 1. How much is the taxable income for the year?2. How much is the current tax expense for the year?A company reported in the income statement for the current year P900,000 income before provision for income tax. Please consider the following information: Rent income received in advance 150,000Interest income on time deposit 200,000Depreciation deducted for income tax purposes in excess of financial depreciation 100,000Income tax rate 30% Required: 1. How much is the taxable income?2. How much is the accounting income subject to tax?3. How much is the permanent difference?4. How much is the net temporary differences?The following information was extracted from the records of Gin Gin Ltd for the year ended 30 June 2021. Additional information The accumulated tax depreciation for machines at 30 June 2021 was $50 000. The tax rate is 30%. Required Prepare a deferred tax worksheet to identify the temporary differences arising in respect of the assets and liabilities in the statement of financial position, and to calculate the balance of the deferred tax liability and deferred tax asset accounts at 30 June 2021. Assume the opening balances of the deferred tax accounts were $2,000 for Deferred Tax Assets and $1,500 for Deferred Tax Liability. Prepare the journal entry to adjust the deferred tax account.
- Big Blue Inc. (BBI) listed the following items to prepare a reconciliation between book and taxable income. GAAP net income before tax $ 700,000Entertainment expense 100,000GAAP depreciation expense 90,000Depreciation expense for tax purposes 120,000 a. Compute BBI's tax expense for financial statement purposes.b. Compute BBI's tax payable to the IRS.c. Compute the net increase in BBI's deferred tax assets or deferred tax liabilities for the year.d. Record the journal entry to record taxes for the year.At the end of the year, a deductible temporary difference of $40 million has been recognised due to the difference between the carrying amount of a liability account for estimated expenses and its tax base. Taxable income is $50 million. No temporary differences existed at the beginning of the year, and the tax rate is 35%. Required: a. Prepare the journal entry(s) to record income taxes during the period. b.How much will income tax expense be shown in the income statement? c. What will be the balance sheet disclosure during the period regarding taxes?At the end of the year, a deductible temporary difference of $40 million has been recognised due to the difference between the carrying amount of a liability account for estimated expenses and its tax base. Taxable income is $50 million. No temporary differences existed at the beginning of the year, and the tax rate is 35%. Required: a. Prepare the journal entry(s) to record income taxes during the period. b.How much will income tax expense be shown in the income statement? c.
- *see attached problem REQUIRED: What amount should be reported as current portion of income tax expense in the income statement for the current year?Bonita Inc. reports the following pretax income (loss) for both book and tax purposes. Pretax Year Income (Loss) Tax Rate 2018 $124,000 20 % 2019 86,000 20 % 2020 (89,000 ) 25 % 2021 126,000 25 % The tax rates listed were all enacted by the beginning of 2018. Prepare the journal entries for years 2018-2021 to record income tax expense (benefit) and income taxes payable, and the tax effects of the loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-half of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)Beaver Dam Inc. (BDI) listed the following items to prepare a reconciliation between book and taxable income. GAAP net income before tax $700,000 Meal expense 100,000 GAAP depreciation expense 110,000 Depreciation expense for tax purposes 120,000 a. Compute BDI’s tax expense for financial statement purposes. b. Compute BDI’s tax payable to the IRS. c. Compute the net increase in BDI’s deferred tax assets or deferred tax liabilities for the year. d. Prepare the journal entry to record taxes for the year.
