gross incomeMINUSadjustments toincomeTABLE 4.9Tax Rate10%15%25%28%33%35%39.6%StandardEQUALSadjusted grossincomeFIGURE 4.13 Flow chart showing the basic steps in calculating income tax.deductionExemption(per person)adjusted grossincomeMINUSdeductions andexemptions$4050EQUALStaxable incomeSingleup to $9325up to $37,950up to $91,900up to $191,650up to $416,700up to $418,400above $418,400$63502017 Marginal Tax Rates, Standard Deductions,and Exemptions*Married FilingJointlyup to $18,650up to $75,900up to $153,100up to $233,350up to $416,700up to $470,700above $470,700$12,700tax computationbased on ratesor tables3. Victor is in the 28% tax bracket.MINUStax credits$4050EQUALStotal taxMarried FilingSeparatelyup to $9325up to $37,950up to $76,550up to $116,675up to $208,350up to $235,350above $235,350$6350$4050total taxMINUSpayments orwithholdingEQUALSamount owed(or refund)Head ofHouseholdup to $13,350up to $50,800up to $131,200up to $212,500up to $416,700up to $444,550$4050above $444,550$9350*This table ignores (i) exemption and deduction phase-outs that apply to high-income taxpayers; (ii) the alterna-tive minimum tax (AMT) that affects many middle- and high-income taxpayers; (iii) potential changes in tax lawmade after this text was printed that may have changed the values given in this table for 2017.Each higher marginal rate begins where the prior one leaves off. For example, for a single person, the 15%marginal rate affects income starting at $9325, which is where the 10% rate leaves off, and continuing up tob. How much will a $900 charitable contribution save him if he itemizes his deductions?

An itemized deduction seems to be one that is subtracted from your AGI in order to minimize your…

gross income MINUS adjustments to income EQUALS adjusted gross income adjusted gross income TABLE 4.9 MINUS deductions and exemptions EQUALS taxable income tax computation based on rates or tables MINUS tax credits EQUALS total tax FIGURE 4.13 Flowchart showing the basic steps in calculating income tax 2017 Marginal Tax Rates, Standard Deductions, and Exemptions* total tax MINUS payments or withholding EQUALS amount owed (or refund)

gross income MINUS adjustments to income EQUALS adjusted gross income adjusted gross income TABLE 4.9 MINUS deductions and exemptions EQUALS taxable income tax computation based on rates or tables MINUS tax credits EQUALS total tax FIGURE 4.13 Flowchart showing the basic steps in calculating income tax 2017 Marginal Tax Rates, Standard Deductions, and Exemptions* total tax MINUS payments or withholding EQUALS amount owed (or refund)

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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Hw.52.
Using accrual basis, how much is the reportable gross income in 2021? A. 8,000,000B. 9,000,000C. 11,000,000D. 12,000,000
Refund of value added taxes in the current year which were erroneously paid in a prior year is generally Subject to final income tax Included in gross income O Not included in gross income O Deducted from retained earnings
A22
Q1. Taxable income and applicable tax rates for C.J. Company’s first four years are shown below. For each year, taxable income and pretax financial income are identical. In the table below, taxable income is before any consideration of NOL carryback and carryforward. The enacted tax rates were known at 1/1/2018. Taxable Income Enacted tax rate 2018 $200 20% 2019 ($300) 15% 2020 $340 25% 2021 $210 25% Now assume that C.J. opted to carryback its 2019 NOL and carryforward any unused NOL to future years. Complete the table below for 2018 through 2021 to show the amount of income tax payable to the IRS or the refund due from the IRS for each year. Put your answer in the table below. Show tax payable as a positive number and tax refund as a negative number. Year Tax…
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b. Extracts from trial balance at 31 March, 2019 GH¢ Current tax credit balance 1,600,000 Deferred tax liability 5,200,000 The balance on current tax represents the under/over provision of the tax liability for the year ended 31 March, 2018. The required provision for income tax for the year ended 31 March, 2019 is GH 38.8 million. The difference between the carrying amounts of the net assets of the company and their (lower) tax base at 31 March, 2019 is GH¢54 million. The rate of income tax is 25%. Required: Prepare a Statement of Profit or Loss Extract and Statement of Financial Position Extract for 31 March, 2019.
Nash reported the following pretax financial income (loss) for the years 2020-2022. 2020 $98,400 2021 (116,000) 2022 147,600 Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 20% for 2020-2022. Prepare the journal entries for the years 2020-2022 to record income tax expense, 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-fifth of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered. Do not indent manualy. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2020 2021 (To record refund) (To record allowance) 2022 (To record income taxes) (To adjust allowance)
Chapter 3 Activity – Taxes Individual Income Tax Brackets (2021) Marginal Tax Rate Single, taxable income over: Joint, taxable income over: Head of Household, taxable income over: 10% $0 $0 $0 12% $9,950 $19,900 $14,200 22% $40,525 $81,050 $54,200 24% $86,375 $172,750 $86,350 32% $164,925 $329,850 $164,900 35% $209,425 $418,850 $209,400 37% $523,600 $628,300 $523,600 Standard Deduction Amounts (2021) Filing Status Deduction Amount Single $12,550 Married Filing Jointly $25,100 Head of Household $18,800 Long-term Capital Gains & Qualified Dividends (2021) Tax Rate Single Joint Head of Household 0% Under $40,000 Under $80,800 Under $54,100 15% $40,400 $80,800 $54,100 20% $445,850 $501,600 $473,750 Additional 3.8% Net Investment Income Tax for MAGI over $200,000 / $250,000 / $200,000 Calculate the federal income…
Nonordinary items resulting in income or loss a. include unusual but not infrequent gains. b. are treated the same as ordinary items when calculating the effective tax rate. c. are always treated as a total group when calculating the effective rate for the quarter. d. are always excluded from interim reporting.
Exercise 16-10 (Algo) Calculate income tax amounts under various circumstances; financial statement effects [LO16-2, 16-3] Four independent situations are described below. Each involves future deductible amounts and/or future taxable amounts produced by temporary differences: ($ in thousands) Taxable income Future deductible amounts Future taxable amounts. Balance(s) at beginning of the year: Deferred tax asset Deferred tax liability The enacted tax rate is 25%. Required: Situation 1 2 3 4 $ 112 $ 244 $ 252 $ 344 16 20 20 16 16 56 2 16 8 2 For each situation, determine the following: Note: Enter your answers in thousands rounded to one decimal place (i.e. 1,200 should be entered as 1.2). Negative amounts should be indicated by a minus sign. Leave no cell blank, enter "O" wherever applicable. a. Income tax payable currently. b. Deferred tax asset-ending balance. c. Deferred tax asset-change. d. Deferred tax liability-ending balance. e. Deferred tax liability change. f. Income tax…