Luong Corporation, a calendar year, accrual basis corporation, reported $1.85 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: Luong's federal income tax expense per books was $217,000. • Luong's book income included $27,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $12,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $27,000 of capital losses this year and no capital gains. Luong recorded $16,600 of book expense for meals and $18,500 of book expense for entertainment costs. Luong's depreciation expense for book purposes totaled $417,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income. Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B Compute Luong's federal taxable income and regular tax liability. Note: Enter your answers in whole dollars not in millions. Amount Taxable income $ 1,623,900x Tax liability $ 429,891 x < Required A Required B >
Luong Corporation, a calendar year, accrual basis corporation, reported $1.85 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: Luong's federal income tax expense per books was $217,000. • Luong's book income included $27,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $12,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $27,000 of capital losses this year and no capital gains. Luong recorded $16,600 of book expense for meals and $18,500 of book expense for entertainment costs. Luong's depreciation expense for book purposes totaled $417,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income. Answer is not complete. Complete this question by entering your answers in the tabs below. Required A Required B Compute Luong's federal taxable income and regular tax liability. Note: Enter your answers in whole dollars not in millions. Amount Taxable income $ 1,623,900x Tax liability $ 429,891 x < Required A Required B >
Chapter17: Corporations: Introduction And Operating Rules
Section: Chapter Questions
Problem 5BCRQ
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Question
Please do fast don't use ai to answer
Transcribed Image Text:Luong Corporation, a calendar year, accrual basis corporation, reported $1.85 million of net income after tax on its financial statements
prepared in accordance with GAAP. The corporation's books and records reveal the following information:
Luong's federal income tax expense per books was $217,000.
• Luong's book income included $27,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock
interest, and $12,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest.
Luong recognized $27,000 of capital losses this year and no capital gains.
Luong recorded $16,600 of book expense for meals and $18,500 of book expense for entertainment costs.
Luong's depreciation expense for book purposes totaled $417,000. MACRS depreciation was $475,000.
Required:
a. Compute Luong's federal taxable income and regular tax liability.
b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income.
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Required A Required B
Compute Luong's federal taxable income and regular tax liability.
Note: Enter your answers in whole dollars not in millions.
Amount
Taxable income
$
1,623,900x
Tax liability
$
429,891 x
< Required A
Required B >
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