Information for Kent Corp. for the year 2013: Reconciliation of pretax accounting income and taxable income: Pretax accounting income Permanent differences Temporary difference-depreciation Taxable income $178,500 (13,800) 164,700 (12,700) $152,000 Cumulative future taxable amounts all from depreciation temporary differences: As of December 31, 2012 $13,200 As of December 31, 2013 $25,900 The enacted tax rate was 23% for 2012 and thereafter. What should be the balance in Kent's deferred tax liability account as of December 31, 2013? a) $4,356. b) $5,957. c) $25,900. d) None of the above is correct.

Information for Kent Corp. for the year 2013: Reconciliation of pretax accounting income and taxable income: Pretax accounting income Permanent differences Temporary difference-depreciation Taxable income $178,500 (13,800) 164,700 (12,700) $152,000 Cumulative future taxable amounts all from depreciation temporary differences: As of December 31, 2012 $13,200 As of December 31, 2013 $25,900 The enacted tax rate was 23% for 2012 and thereafter. What should be the balance in Kent's deferred tax liability account as of December 31, 2013? a) $4,356. b) $5,957. c) $25,900. d) None of the above is correct.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

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

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

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 12E: Temporary and Permanent Differences Lin has just completed its first year of operations and has a...

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The information that follows pertains to Esther Food Products:a. At December 31, 2018, temporary differences were associated with the following future taxable (deductible)amounts:Depreciation $ 60,000Prepaid expenses 17,000Warranty expenses (12,000)b. No temporary differences existed at the beginning of 2018.c. Pretax accounting income was $80,000 and taxable income was $15,000 for the year ended December 31,2018.d. The tax rate is 40%.Required:Determine the amounts necessary to record income taxes for 2018, and prepare the appropriate journal entry.
Temporary and Permanent Differences Lin has just completed its first year of operations and has a number of differences between its pretax financial income and taxable income. The differences at the end of 2019 are as follows: a. Lin recorded 7,000 of interest revenue on municipal bonds during 2019. b. 15,000 of accrual-basis sales were recognized in income during 2019. They are expected to be received in cash during January 2020. c. Depreciation on machinery totaled 28,000 using straight-line depreciation for financial statements. Lins tax accountant recorded 36,000 of depreciation on the companys tax return. d. Lin was fined 3,000 for violating certain labor laws during 2019. Lin paid the fine during 2019 and agreed to ensure future violations would not occur. e. Bryant Corporation has agreed to rent space from Lin in 2020. In December 2019, Lin received 7,500 from Bryant in advance for rent. f. For 2019, Lin reported 9,500 of warranty expense on its income statement. The companys warranty liability at the end of 2019 was 6,250. Lin expects additional warranty costs to be paid during 2020. Required: 1. For each item, determine if it results in a temporary or permanent difference. If the item results in a temporary difference, determine if it results in a deferred tax asset or deferred tax liability. 2. For each item, determine if it initially results in pretax financial income being greater than or less than taxable income. 3. Next Level Discuss why permanent differences do not impact future periods taxable income and how these differences affect tax rates.
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Item6 Item 6 Information for Kent Corporation for the year 2024: Reconciliation of pretax accounting income and taxable income: Pretax accounting income $ 179,800 Permanent differences (16,300) 163,500 Temporary difference - depreciation (13,400) Taxable income $ 150, 100 Cumulative future taxable amounts all from depreciation temporary differences: As of December 31, 2023 $ 14,300 As of December 31, 2024 $ 27,700 The enacted tax rate was 26% for 2023 and thereafter. What should Kent report as the current portion of its income tax expense in the year 2024?
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The information that follows pertains to Esther Food Products: a. At December 31, 2024, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses $ 52,000 22,000 (19,000) b. No temporary differences existed at the beginning of 2024. c. Pretax accounting income was $74,000 and taxable income was $19,000 for the year ended December 31, 2024. d. The tax rate is 25%. Required: Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024. Complete this question by entering your answers in the tabs below. Calculation General Journal Complete the following table given below to record income taxes for 2024. Note: Amounts to be deducted should be entered with a minus sign. Description Pretax accounting income Permanent differences Income subject to taxation Temporary Differences Income taxable in current year Calculation General Journal Amount Tax Rate $…
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