sh.3 Exercise 16-24 (Algo) Net operating loss carryforward; financial statement effects [LO16-7]During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss of $450,000 for financial reportingand tax purposes. During 2025, Baginski reported income of $250,000 for financial reporting and tax purposes. The enacted tax rateis 25%.Required:1. Prepare the journal entry to recognize Baginski's 2025 tax expense or tax benefit.2. Show the lower portion of the 2025 income statement that reports income tax expense or benefit.Complete this question by entering your answers in the tabs below.Required 1Required 2Prepare the journal entry to recognize Baginski's 2025 tax expense or tax benefit.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.View transaction listJournal entry worksheet1Record 2024 income tax benefit from operating loss.Note: Enter debits before credits.Event1General JournalDebitCreditView general journalRecord entryClear entry>

To address the exercise regarding Baginski Steel Corporation's net operating loss carryforward and…

Answered: Exercise 16-24 (Algo) Net operating…

Intermediate Accounting: Reporting And Analysis

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Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

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Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 13P

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Problem 16-2 (ACP) Zeus Company reported pretax financial income of P8,000,000 for the year ended December 31, 2021. The taxable income was P9,000,00. The difference is due to rental received in advance. Rental income is taxable when received. The income tax rate is 25% and Zeus Company made estimated tax payment of P1,000,000 during the current year. Required: a. Prepare journal entries relating to income tax for 2021. b. Compute the total income tax expense for 2021.
Problem 15-58 (LO 15-6) In each of the following independent cases for tax year 2022, determine the amount of business interest expense deduction and disallowed interest expense carryforward, if any. Assume that average annual gross receipts exceed $27 million. Required: a. Company A has ATI of $70,000 and business interest expense of $20,000. b. Company B has ATI of $90,000, business interest expense of $50,000, and business interest income of $2,000. c. Company C has taxable income of $50,000 which includes business interest expense of $90,000 and depreciation of $20,000. Note: For all requirements, leave no cells blank - be certain to enter "0" wherever required. Enter your answers in dollar values not in million of dollars. a. Company A b. Company B c. Company C Interest expense deduction Disallowed interest expense carryforward
Item 4 During 2021, its first year of operations, Baginski Steel Corporation reported a net operating loss of $408,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required:1. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests that future taxable income will be sufficient to benefit from future deductible amounts arising from the net operating loss carryforward.2. Show the lower portion of the 2021 income statement that reports the income tax benefit of the net operating loss.
Immediate Accounting ll Ch 16 3. During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss of $360,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required: Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests that future taxable income will be sufficient to benefit from future deductible amounts arising from the net operating loss carryforward. Show the lower portion of the 2024 income statement that reports the income tax benefit of the net operating loss. Required 1 Record 2024 income tax benefit from operating loss Transaction General Journal Debit Credit 1
x Company reports the following pretax income (loss) for both book and tax purposes. Year. Pretax income tax rate 2018 120,000 20% 2019 93,000 20% 2020. (82,000) 25% 2021 110,000 25% The tax rates listed were enacted by the beginning of 2018 Prepare the income tax section of the 2020 income statment beginning with the line "operating loss before income taxes" Prepare the income tax section of the 2021 income statment beginning with the line "operating loss before income taxes" I have the journal entries I need the income statment -prepare 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.
x Company reports the following pretax income (loss) for both book and tax purposes. Year. Pretax income tax rate 2018 120,000 20% 2019 93,000 20% 2020. (82,000) 25% 2021 110,000 25% The tax rates listed were 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.
Tiepare vVITgm E18-18 Calculating Intraperiod Income Taxes EyeBeam Corporation reports the following pretax accounting (and LO 18.6 taxable) income items during 2019: Income from continuing operations Loss from operations of a discontinued division Gain from the disposal of the discontinued division $ 90,000* (10,000) 25,000 *Of this amount, revenues are $320,000 and expenses are $230,000. Required: 1. Prepare the journal entry necessary to record the 2019 intraperiod income tax allocation in regard to the pre- ceding information. Assume a tax rate of 15% on the first $40,000 of income and a rate of 30% on income in excess of $40,000. Prepare EyeBeam's 2019 income statement. 2.
PROBLEM 1 Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return:Taxable income P 4,000,000Non-deductible expenses 200,000Non-taxable revenue 300,000Deferred income on installment saleincluded in financial income but taxable in 2022 450,000Doubtful accounts recorded 100,000Financial depreciation 300,000Tax depreciation 350,000Estimated warranty cost accrued in2021 but not deductible for tax purposes until paid…
Current Attempt in Progress The pretax financial income (or loss) figures for Larkspur Company are as follows. 2022 $82,000 2023 (47,000) 2024 (42,000) 2025 128,000 2026 105,000 Pretax financial income (or loss) and taxable income (loss) were the same for all years involved. Assume a 20% tax rate for all years. Prepare the journal entries for the years 2022 to 2026 to record income tax expense and the effects of the net operating loss carryforwards. All income and losses relate to normal operations. (In recording the benefits of a loss carryforward, assume that no valuation account is deemed necessary.) (List all debit entries before credit entries. 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 O for the amounts. Record journal entries in the order presented in the problem.)
23. Operating income and tax rates for CJ. Company's first three years of operations were as follows: Amount a. $325,000 b. $340,000 2014 2015 2016 c. $325,000 d. $340,000 Income $300,000 ($850,000) $1,060,000 Assuming that C.J. Company opts to carryforward its 2015 NOL, what is the amount of deferred tax asset or liability that C.J. Company would report on its December 31, 2015 balance sheet? Enacted tax rate 35% 30% 40% Deferred tax asset or liability Deferred tax liability Deferred tax liability Deferred tax asset Deferred tax asset
CHANGE IN ACCOUNTING PRINCIPLE EXERCISE DURING 2021, A CONSTRUCTION COMPANY THAT BEGAN OPERATIONS IN 2019 CHANGED FROM THE COMPLETED CONTRACT METHOD TO THE PERCENTAGE OF COMPLETION METHOD FOR ACCOUNTING PURPOSES BUT NOT FOR TAX PURPOSES. GROSS PROFIT FIGURES UNDER BOTH METHODS FOR THE PAST THRE YEARS APPEAR BELOW. ALSO, ASSUME THE FOLLOWING INFORMATION: • THE RETAINED EARNINGS BALANCE AS OF JANUARY 1, 2020 IS $2,000,000. TAX RATE – 30% Completed-Contract Percentage-of-Completion 2019 $ 484000 $ 911000 2020 635000 960000 2021 710000 1060000 $1829000 $2931000 REQUIRED: 1. SCENARIO 1 – PREPARE JOURNAL ENTRY, INCOME STATEMENT AND RETAINED EARNINGS STATEMENT, ASSUMING COMPARATIVE FINANCIAL STATEMENTS ARE ISSUED. 2. SCENARIO 2 – PREPARE JOURNAL ENTRY, INCOME STATEMENT AND RETAINED EARNINGS STATEMENT, ASSUMING COMPARATIVE FINANCIAL STATEMENTS ARE NOT ISSUED.
BLOCK D/2018/2 A company shows a taxable profit of € 1.3 million for t1 in the tax balance sheet. The income tax rate is 30%. In addition, net income under commercial law before taxes of € 1.6 million was reported in the same reporting period. What is the maximum amount this company can distribute to shareholders from the annual results of the current reporting period? Present your calculations comprehensibly!

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