ng Corporation, a calendar year, accrual basis corporation, reported $1.35 million of net income after tax on its financial statement pared in accordance with GAAP. The corporation's books and records reveal the following information: Luong's federal income tax expense per books was $207,000. Luong's book income included $17,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock nterest, and $7,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $17,000 of capital losses this year and no capital gains. Luong recorded $11,600 of book expense for meals not provided by a restaurant and $13,500 of book expense for entertainment costs. uong's depreciation expense for book purposes totaled $407,000. MACRS depreciation was $475,000. uired: Compute Luong's federal taxable income and regular tax liability. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income. Answer is not complete.
ng Corporation, a calendar year, accrual basis corporation, reported $1.35 million of net income after tax on its financial statement pared in accordance with GAAP. The corporation's books and records reveal the following information: Luong's federal income tax expense per books was $207,000. Luong's book income included $17,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock nterest, and $7,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $17,000 of capital losses this year and no capital gains. Luong recorded $11,600 of book expense for meals not provided by a restaurant and $13,500 of book expense for entertainment costs. uong's depreciation expense for book purposes totaled $407,000. MACRS depreciation was $475,000. uired: Compute Luong's federal taxable income and regular tax liability. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income. Answer is not complete.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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dont uplode any images in answer
![Problem 11-12 (Algo) [LO 11-3, 11-4]
Luong Corporation, a calendar year, accrual basis corporation, reported $1.35 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 $207,000.
• Luong's book income included $17,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock
interest, and $7,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest.
• Luong recognized $17,000 of capital losses this year and no capital gains.
• Luong recorded $11,600 of book expense for meals not provided by a restaurant and $13,500 of book expense for entertainment
costs.
• Luong's depreciation expense for book purposes totaled $407,000. 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.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Taxable income
Tax liability
Answer is not complete.
Compute Luong's federal taxable income and regular tax liability.
Note: Enter your answers in whole dollars not in millions.
Amount
$ 2,426,175 X
$ 510,299 X
< Required A
Required B >](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F28dd43fa-e114-40ae-8843-871784b53941%2Fb53746a6-1ff2-4b72-95ec-3df2154518b0%2Fr9wr65t_processed.png&w=3840&q=75)
Transcribed Image Text:Problem 11-12 (Algo) [LO 11-3, 11-4]
Luong Corporation, a calendar year, accrual basis corporation, reported $1.35 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 $207,000.
• Luong's book income included $17,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock
interest, and $7,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest.
• Luong recognized $17,000 of capital losses this year and no capital gains.
• Luong recorded $11,600 of book expense for meals not provided by a restaurant and $13,500 of book expense for entertainment
costs.
• Luong's depreciation expense for book purposes totaled $407,000. 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.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Taxable income
Tax liability
Answer is not complete.
Compute Luong's federal taxable income and regular tax liability.
Note: Enter your answers in whole dollars not in millions.
Amount
$ 2,426,175 X
$ 510,299 X
< Required A
Required B >
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