What was the taxable income for the year? Langford Corporation, a closely held corporation, generated $180,000 of incomefrom operations during the year. It also received passive losses of $250,000 andinterest income of $45,000. Langford Corporation was fully at risk for the amountof the loss. What is the company's taxable income for the year?a. $0b. $25,000c. $50,000d. $75,000

The answer is (a) $0.Here's the reasoning:Passive Activity Loss Limitations: Closely held…

Answered: Langford Corporation, a closely held…

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 7DQ

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The Bookbinder Company had 500,000 cumulative operating losses prior to the beginning of last year. It had 100,000 in pre-tax earnings last year before using the past operating losses and has 300,000 in the current year before using any past operating losses. It projects 350,000 pre-tax earnings next year. a. How much taxable income was there last year? How much, if any, cumulative losses remained at the end of the last year? b. What is the taxable income in the current year? How much, if any, cumulative losses remain at the end of the current year? c. What is the projected taxable income for next year? How much, if any, cumulative losses are projected to remain at the end of next year?
During the current year, Sparrow Corporation, a calendar year C corporation, had operating income of $425,000, operating expenses of $280,000, a short-term capital loss of $10,000, and a long-term capital gain of $25,000. How much is Sparrow's income tax liability for the year? a. $33,600 b. $32,700 c. $45,650 Od. $62,400
Sol Limited. reported earnings of $510,000 in 20X8. The company has $91,000 of depreciation expense this year, and claimed CCA of $142,000. The tax rate was 25%. At the end of 20X7, there was a $122,000 loss carryforward that was not recorded because use was considered less than probable. The company also reported a deferred tax liability of $71,000 caused by capital assets with a net book value of $1,310,000 and UCC of $1,010,000. The tax rate had been 20% in 20X7. The answer $84,250 and $114,750 is incorrect. Required:What is the amount of income tax expense in 20X8? Record the entry loss carryforward. Record the entry income tax expense.
Sol Limited. reported earnings of $510,000 in 20X8. The company has $91,000 of depreciation expense this year, and claimed CCA of $142,000. The tax rate was 25%. At the end of 20X7, there was a $122,000 loss carryforward that was not recorded because use was considered less than probable. The company also reported a deferred tax liability of $71,000 caused by capital assets with a net book value of $1,310,000 and UCC of $1,010,000. The tax rate had been 20% in 20X7. Required:What is the amount of income tax expense in 20X8? Prepare the income tax entry or entries. - Record the entry income tax expense. - Record the entry loss carryforward.
Mercury Limited reported earnings of $75,000 in 20X9. The company has $55,000 of depreciation expense this year, and claimed. CCA of $90,000. The tax rate was 25%. At the end of 20X8, there was a $10,000 loss carryforward reported in a deferred tax asset. account valued at $2,200, and a deferred tax liability of $35,200 caused by capital assets with a net book value of $500,000 and UCC of $340,000. Required: What is the amount of income tax expense in 20X9? Tax expense $ Prepare the income tax entry or entries. View transaction list No 1 2 Date 20X9 23,250 20X9 View journal entry worksheet Income tax expense General Journal Deferred income tax asset Income tax payable Income tax payable Income tax expense Debit Credit
Sol Limited. reported earnings of $510,000 in 20X8. The company has $91,000 of depreciation expense this year, and claimed CCA of $142,000. The tax rate was 25%. At the end of 20X7, there was a $122.000 loss carryforward that was not recorded because use was considered less than probable. The company also reported a deferred tax liability of $71,000 caused by capital assets with a net book value of $1,310,000 and UCC of $1,010,000. The tax rate had been 20% in 20X7 Required: What is the amount of income tax expense in 20X8? Tax expense Prepare the income tax entry or entries. View transaction list No 1 Date 20X8 View journal entry worksheet Income tax expense Income tax payable Deferred income tax asset General Journal Debit Credit 114,750
Sol Limited. reported earnings of $550,000 in 20X8. The company has $95,000 of depreciation expense this year, and claimed CCA of $150,000. The tax rate was 28%. At the end of 20X7, there was a $130,000 loss carryforward that was not recorded because use was considered less than probable. The company also reported a deferred tax liability of $75,000 caused by capital assets with a net book value of $1,350,000 and UCC of $1,050,000. The tax rate had been 20% in 20X7. Required: What is the amount of income tax expense in 20X8? Tax expense Prepare the income tax entry or entries. A View transaction list No 1 2 Date 20X8 20X8 View journal entry worksheet Income tax expense Deferred income tax asset Income tax payable Income tax payable Income tax expense General Journal Debit Credit 138,600
Heavenly Taft, Inc. sold a division of its company during the year for a $400,000 gain. Prior to the date of sale, the year-to-date net loss for the division was A $1,000,000. The company's tax rate is 30%. What will be reported on the income statement as a "special item?" O $420,000 loss O $1,000,000 discontinued operation loss less a $300,000 tax savings O $400,00 gain less $120,000 income tax O Both B and C
Westwind Corporation reports the following results for the current year: Gross profit on sales $250,000 Long-term capital gain 25,000 Long-term capital loss 10,000 Short-term capital gain 7,500 Short-term capital loss 12,500 Operating expenses 80,000 What are Westwind's taxable income and regular tax liability before credits for the current year?
A domestic corporation had the following cumulative data in a year: 1st Qtr 2nd Qtr 3rd Qtr Year Gross Income P400,000 P800,000 1,000,000 P1,200,000 Expenses and Losses 200,000 420,000 600,000 720,000 REQUIRED: Compute for the Taxable Income if: The corporation chose the itemized deductions in the return for the first quarter? The corporation did not file a return for the 1st quarter? The corporation chose the Optional Standard Deduction for the first quarter?
LO.1, 3 In the current year, Tanager Corporation (a calendar year C corporation) had operating income of $480,000 and operating expenses of $390,000. In addition, Tanager had a long-term capital gain of $55,000 and a short-term capital loss of $40,000. a. Compute Tanager's taxable income and tax for the year. Assume instead that Tanager's long-term capital gain was $15,000 (not $55,000). Compute Tanager's taxable income and tax for the year.
3. War Eagle, Inc. reported the following for 20X3:a. taxable income of $2,000,000 b. paid federal income taxes of $420,000.c. a net operating loss carryover of $1 00,000 d. Section 179 expensed of $300,000 last yeare. Actual business interest expense for book was $2 0,000, but for tax, they could only deduct $15,000 because of the limitation on business interest expense.f. Increase in LIFO recapture of $12,000g. Tax Exempt Income of $1,000h. Operating expenses for tax were $1 00,000, which included $10,000 of MACRS depreciation for tax. Depreciation under the alternative ( E&P) depreciation method was $15,000. Compute the company's current E&P for 20X3.

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