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Gator Incorporated reported taxable income of $1,150,000 this year and paid federal income taxes of $381,000. Included in the company's computation of taxable income is a $67,500 gain from the sale of a depreciable asset with an income tax basis of $135,000. The income tax basis of the asset was $135,000. The E&P basis of the asset using the alternative depreciation system was $234,500. Compute the company's current E&P. Note: Negative amount should be indicated with a minus sign. Taxable income Federal income taxes Regular tax gain from sale of asset E&P loss from sale of asset Current E&P $ 1,150,000 (32,000) $ 1,118,000

Gator Incorporated reported taxable income of $1,150,000 this year and paid federal income taxes of $381,000. Included in the company's computation of taxable income is a $67,500 gain from the sale of a depreciable asset with an income tax basis of $135,000. The income tax basis of the asset was $135,000. The E&P basis of the asset using the alternative depreciation system was $234,500. Compute the company's current E&P. Note: Negative amount should be indicated with a minus sign. Taxable income Federal income taxes Regular tax gain from sale of asset E&P loss from sale of asset Current E&P $ 1,150,000 (32,000) $ 1,118,000

FINANCIAL ACCOUNTING
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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I need help trying to find the federal income taxes and the regular tax gain from sale of an asset.

Gator Incorporated reported taxable income of $1,150,000 this year and paid federal income taxes of $381,000. Included in the company's computation of taxable income is a $67,500 gain from the sale of a depreciable asset with an income tax basis of $135,000. The income tax basis of the asset was $135,000. The E&P basis of the asset using the alternative depreciation system was $234,500. Compute the company's current E&P. Note: Negative amount should be indicated with a minus sign. Taxable income Federal income taxes Regular tax gain from sale of asset E&P loss from sale of asset Current E&P $ 1,150,000 (32,000) $ 1,118,000
Transcribed Image Text:Gator Incorporated reported taxable income of $1,150,000 this year and paid federal income taxes of $381,000. Included in the company's computation of taxable income is a $67,500 gain from the sale of a depreciable asset with an income tax basis of $135,000. The income tax basis of the asset was $135,000. The E&P basis of the asset using the alternative depreciation system was $234,500. Compute the company's current E&P. Note: Negative amount should be indicated with a minus sign. Taxable income Federal income taxes Regular tax gain from sale of asset E&P loss from sale of asset Current E&P $ 1,150,000 (32,000) $ 1,118,000
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