Hopkins Co. at the end of 2021, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows:   Pretax financial Income                                     3,000,000 Estimated litigation expense                              4,000,000 Extra depreciation for taxes                               (6,000,000) Taxable Income                                                 $1,000,000   The tax rate is 20%   Instructions: Calculate the income tax expense and income tax payable for 2021

Q: Computa taxable income for 2019. Taable incoma eTextbook and Medla List of Accounts Precara the…

A: Calculation of Taxable Income for the year 2019

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Q: Required: 1. Determine the amounts necessary to record income taxes for 2021, and prepare the…

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Q: For the year ended December 31, 2019, Nelson Co.’s income statement showed income of $435,000 before…

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A: Income as per completed contract method = $60, 000 Tax = $60, 000*20% = $12, 000

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A: Compute the amounts to record income tax as follows: Result:

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A: Part 1:

Q: r the year ended December 31, 2019, Nelson Co.’s income statement showed income of $425,000 before…

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Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.