On 1 January 20X7, Change Incorporated commenced business operations. At 31 December 20X9, thefollowing information relates to Chang:Earnings (loss) before taxTax rate (enacted in each year)Depreciation expense (asset cost was $610,000)Capital cost allowance.Dividends received (nontaxable)Golf club duesView transaction listJournal entry worksheet12Date20X7Note: Enter debits before credits.Record entry for current and deferred income tax expense payable.20x820X7$304,900 $(456,100)General JournalRequired:1. Prepare journal entries to record tax for 20X7, 20X8, and 20X9. Assume that the loss carryforward usagein 20X8 is considered to be probable. (If no entry is required for a transaction/event, select "No journalentry required" in the first account field.)Income tax expenseIncome tax payableDeferred income tax51,000183,00038,6009,70030%Debit35%Credit51,000060,5009,70020x9$725,00040%51,00079,00060,5009,700 2. Prepare journal entries to record tax for 20X7, 20X8, and 20X9. Assume that the loss carryforward usage in 20X8 is notconsidered to be probable but is considered to be probable in 20X9. (If no entry is required for a transaction/event, select"No journal entry required" in the first account field.)View transaction listJournal entry worksheet1 2 3Record entry for current and deferred income tax expense payable.Note: Enter debits before credits.Date20X7General JournalIncome tax expenseIncome tax payableDeferred income taxRecord entryClear entryDebitCreditView general journal>

Tax is a compulsory duty imposed on the individuals on their incomes. Tax is levied and collected by…

Answered: January 20X7, Change Incorporated…

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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The Guava Corporation has book net income of $90,000 for the current year. Included in this figure are the followingitems which are reported on the corporation's Schedule M-1, Reconciliation of Income (Loss) per Books with Income perReturn1. Federal income tax expense $25,0002. Depreciation deducted on books, not deductible for tax purposes 4,0003. Deduction for 50 percent of meals exp. not allowed for tax purposes (no calculation needed) 3,0004. Deduction for payroll tax penalties not allowed for tax purposes 2,0005. Tax exempt interest income included in book income but not in tax return income 12,000Based on the above information, calculate the Guava Corporation's taxable income for the year. Show your calculations please so i can understand the steps?
Stone Company reported pre-tax book income of $700,000 in 20X1, the first year of operation. The tax depreciation exceeded the book depreciation by $90,000. The tax rate for 20X1 and all future years was 21%. What amount of deferred tax liability should Stone report in its December 31, 20X1, balance sheet? Select one: a. $6,300 b. $14,000 c. $18,900 d. $3,500
Required: a. Calculate the current and deferred tax of Bright Star Ltd for each year, 2018 and 2019 b. Prepare the required tax journal entries for each year.
Beaver Dam Inc. (BDI) listed the following items to prepare a reconciliation between book and taxable income. GAAP net income before tax $700,000 Meal and entertainment expense 100,000 GAAP depreciation expense 110,000 Depreciation expense for tax purposes 120,000 c. Compute the net increase in BDI’s deferred tax assets or deferred tax liabilities for the year. d. Prepare the journal entry to record taxes for the year.
Grand Corporation reported pretax book income of $612,000. Tax depreciation exceeded book depreciation by $408,000. In addition, the company received $306,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $51,000. Compute the company's current income tax expense or benefit. (Leave no answer blank. Enter N/A or zero.) 이 Current income tax Deferred income tax N/A expense $
On December 31, Year 1, ABC Corp had a deferred tax asset of $56,470. On December 31, Year 2, the deferred tax asset is $87,520. The company's Year 2 current tax expense is $98,790. What amount should the company report as total Year 2 income tax expense? 1. $62,660 2. $64,353 3. $66,047 4. $67,740 5. $69.434
An entity reported the following information during the first year of operations: Pretax financial income 9,000,000 Nontaxable interest received 1,000,000 Long-term loss accrual in excess of deductible amount 1,500,000 Tax depreciation in excess of financial depreciation 2,000,000 Income tax rate 30% What is the deferred tax asset at year-end?
Pecorino Company had pretax financial income of P2,500,000 in the current year. The entity made corporate estimated tax payment in the amount of 180,000 during the current year. To compute the provision for income tax, the following information was provided: Interest income received 360,000 Tax depreciation in excess of financial statement amount 160,000 Rent received in advance 280,000 Corporate tax rate 30% What amount of total tax expense should be reported?a. 714,000b. 726,000c. 642,000d. 594,000
Rochester inc had pretax accounting income of 2,700,000 and a tax rate of 20% in 2025 during its first year of operation. Following transactions Received advance rent from pack co for 2026: $96000 Received municipal bond interest $120000 Claimed depreciation for tax purposes in excess of book depreciation $60000 Reported installment sales rev on financial statements in 2025; not recognized for tax purposes until received in 2026: $162000 How much is current tax expense for 2025?
The amount of net deferred tax asset/(liability) at January 1, 2008 is? The amount of net deferred tax asset/(liability) at December 31, 2008 is? Income tax expense – current for 2008 is?
The following items were taken from the adjusted trial balance of the Dylex Corporation for the year ended December 31, 2020. Assume an average 25% income tax on all ens. The accounting period ends December 31, and all amounts given are pre-tax. Dylex Corporation had 11,000 common shares outstanding in 2020 and follows IFRS Cost of goods sold Depreciation expense, building Gain on exchange Gain on sale of assets from discontinued operations Insurance expense Interest expense Interest income Loss on sale of trading investment 140,000 23,000 a) Prepare a multi-step income statement in good form. Please make sure your final anewarts) are accurate to 2 decimal places Dylex Corporation For the Year Ended December 31, 200 125,000 100,000 54,000 52,000 X 58,000 135,000 Operating loss of discontinued operation to disposal date 100,000 Salaries expense 160.000 Sales ** 900,000 REQUIRED DISCLOSURES b) Calculate basic eamings per share (EPS) from continuing operations. Please make sure your final…
DM Corporation provided the following trial balance on December 31, 2X20 which had been adjusted, except for income tax expense: Cash 675,000 Accounts receivable (net) 2,695,000 Inventory 2,185,000 Property, plant, and equipment (net) 10,245,000 Accounts payable and accrued liabilities 1,800,000 Income tax payable 1,500,000 Deferred tax liability 750,000 Share capital 2,500,000 Share premium 3,000,000 Retained earnings, January 1 3,350,000 Net sales and other revenue 15,000,000 Cost and expenses 10,000,000 Income tax expense 2,100,000 27,900,000 27,900,000 The accounts receivable included P1,000,000 due from customers and payable in quarterly installments of P125,000. The last payment is due December 30, 2X22. During the year, the estimated tax payment of P600,000 was charged to income tax expense. The income tax rate is 30% on all types of income. Requirement: On December 31, 2X20, compute for the ff. a. Total current assets b. Total current liabilities c.…

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