Lelak Company was formed on January 1, year 2. Its machinery is being depreciated using the MACRS for income tax reporting and the straight-line method for financial statement reporting. Information concerning depreciation amounts under each method is as follows: Year Year 2 Year 3 MACRS $600,000 800,000 Straight-line method O $30,000 O $150,000 O $210,000 O $90,000 $400,000 View Policies 500,000 Assuming that the enacted income tax rate is 30% for all affected years, the amount of deferred taxes charged to expense in Lelak's year 3 income statement should be

Lelak Company was formed on January 1, year 2. Its machinery is being depreciated using the MACRS for income tax reporting and the straight-line method for financial statement reporting. Information concerning depreciation amounts under each method is as follows: Year Year 2 Year 3 MACRS $600,000 800,000 Straight-line method O $30,000 O $150,000 O $210,000 O $90,000 $400,000 View Policies 500,000 Assuming that the enacted income tax rate is 30% for all affected years, the amount of deferred taxes charged to expense in Lelak's year 3 income statement should be

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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Required information Convers Corporation (calendar year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table 2, and Table 5.) Asset Machinery Computer equipment Delivery truck* Furniture Total Date Placed in Original Service October 25 Basis $ 70,000 February 3 March 17 April 22 $ 253,000 10,000 23,000 150,000 The delivery truck is not a luxury automobile. In addition to these assets, Convers installed qualified real property (MACRS, 15 year, 150% DB) on May 12 at a cost of $300,000. b. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect out of bonus depreciation (but does not take §179 expense)? MACRS depreciation $ 553,000
Convers Corporation (calendar year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table 2, and Table 5.) Asset Date Placed in Service Original Basis Machinery October 25 $ 104,000 Computer equipment February 3 44,000 Delivery truck* March 17 57,000 Furniture April 22 184,000 Total $ 389,000 *The delivery truck is not a luxury automobile. In addition to these assets, Convers installed qualified real property (MACRS, 15 year, 150% DB) on May 12 at a cost of $640,000. b. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect out of bonus depreciation (but does not take §179 expense)? Note: Round your intermediate calculations to the nearest whole dollar amount. Table 1 MACRS Half-Year Convention Depreciation Rate for Recovery Period 3-Year 5-Year 7-Year 10-Year 15-Year 20-Year Year 1 33.33%…
Chaz Corporation has taxable income in 2022 of $314,800 for purposes of computing the $179 expense and acquired the following assets during the year; Asset Office furniture Computer equipment Delivery truck Qualified real property (MACRS, 15 year, 150% DB) Total Placed in Service September 12 February 10 August 21 September 30 Maximumn total depreciation deduction Basis $ 808,000 958,000 96,000 1,527,000 $ 3,389,000 What is the maximum total depreciation deduction that Chaz may deduct in 2022? (Use MACRS Table 1, Table 2. Table 3. Table 4 and Table 5.) Note: Round your intermediate calculations and final answer to the nearest whole dollar amount.
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AMP Corporation (calendar year-end) has 2022 taxable income of $1,900,000 for purposes of computing the $179 expense. During 2022, AMP acquired the following assets: (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) Asset Placed in Service Machinery September 12 Computer equipment Office building February 10 April 2 Basis $ 1,550,000 365,000 480,000 Total $ 2,395,000 b. What is the maximum total depreciation, including §179 expense, that AMP may deduct in 2022 on the assets it placed in service in 2022, assuming no bonus depreciation?
EMC began operations during 2004. Taxable income in 2005 was $829,000. Basis differences as of 12/31/04 and 12/31/05 are as follows: Description of difference 12/31/04 12/31/05 Property, Plant, & Equipment, net: GAAP basis $1,102,000 $1,880,000 Tax basis 1,000,000 1,800,000 Basis difference $102,000 $80,000 Investments – Trading GAAP basis (fair value) $785,000 $823,000 Tax basis (cost or amortized cost) 903,000 948,000 Basis difference…
Required information Convers Corporation (calendar year-end) acquired the following assets during the current tax year: (ignore $179 expense and bonus depreciation for this problem): (Use MACRS Table 1. Table 2 and Table 5.) Asset Machinery Computer equipment Delivery truck Furniture Total Date Placed in Original Service Basis $116,000 October 25 February 3 MACRS depreciation March 17 April 22 56,000 69,000 196,000 $ 437,000 *The delivery truck is not a luxury automobile. In addition to these assets, Convers installed qualified real property (MACRS, 15 year, 150% DB) on May 12 at a cost of $760,000. a. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect $179 expense and elects out of bonus depreciation? Note: Round your intermediate calculations and final answer to the nearest whole dollar amount.
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Convers Corporation (calendar year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonus depreciation for this problem): (Use MACRS Table 1, Table 2, and Table 5.) Asset Machinery Computer equipment Delivery truck* Furniture Date Placed in Original Service October 25 Basis $ 72,000 February 3 March 17 April 22 Total 12,000 25,000 152,000 $ 261,000 "The delivery truck is not a luxury automobile. In addition to these assets, Convers installed qualified real property (MACRS, 15 year, 150% DB) on May 12 at a cost of $320,000. Problem 10-54 Part b (Algo) b. What is the allowable MACRS depreciation on Convers's property in the current year assuming Convers does not elect out of bonus depreciation (but does not take §179 expense)? Note: Round your intermediate calculations to the nearest whole dollar amount. MACRS depreciation
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