What amount of deferred tax liability should be reported? Oxford Corporation began operations in 2012 and reported apretax financial income of $225,000 for the year. Oxford's taxdepreciation exceeded its book depreciation by $40,000.Oxford's tax rate for 2012 and years thereafter is 30%. In itsDecember 31, 2012, balance sheet, what amount of deferred taxliability should be reported?

Step 1: Define Tax liabilityThe amount that is to be paid to the government after excluding…

Answered: Oxford Corporation began operations in…

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 24CE

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Prior to and during 2019, Shadrach Company reported tax depreciation at an amount higher than the amount of financial depreciation, resulting in a book value of the depreciable assets of 24,500 for financial reporting purposes and of 20,000 for tax purposes at the end of 2019. In addition, Shadrach recognized a 3,500 estimated liability for legal expenses in the financial statements during 2019; it expects to pay this liability (and deduct it for tax purposes) in 2023. The current tax rate is 30%, no change in the tax rate has been enacted, and the company expects to be profitable in future years. What is the amount of the net deferred tax liability at the end of 2019? a. 300 b. 450 c. 1,050 d. 1,350
In the current year, Madison Corporation had 50,000 of taxable income at a tax rate of 25%. During the year, Madison began offering warranties on its products and has a Warranty liability for financial reporting purposes of 5,000 at the end of the year. Warranty expenses are not deductible until paid for income tax purposes. Prepare the journal entry to record Madisons income taxes at the end of the year.
Oxford Corporation began operations in 2012 and reported a pretax financial income of $225,000 for the year. Oxford's tax depreciation exceeded its book depreciation by $40,000. Oxford's tax rate for 2012 and years thereafter is 30%. In its December 31, 2012, balance sheet, what amount of deferred tax liability should be reported?
Bramble corporation began operations in 2025 and reported pretax financial income of $226,000 for the year. Bramble's tax depreciation exceeded its book depreciation by $39,000. Bramble's tax rate for 2025 and years thereafter is 30%. In its December 31, 2025, balance sheet, what amount of deferred tax liability should be reported?
Headland Corporation began operations in 2020 and reported pretax financial income of $226,000 for the year. Headland’s tax depreciation exceeded its book depreciation by $39,000. Headland’s tax rate for 2020 and years thereafter is 30%. In its December 31, 2020, balance sheet, what amount of deferred tax liability should be reported?
The following information is available for Indigo Corporation for 2016 (its first year of operations). 1. Excess of tax depreciation over book depreciation, $40,800. This $40,800 difference will reverse equally over the years 2017–2020. 2. Deferral, for book purposes, of $18,200 of rent received in advance. The rent will be recognized in 2017. 3. Pretax financial income, $298,300. 4. Tax rate for all years, 30%. What is the taxable income for 2016?
During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss of $405,000 for financial reporting and tax purposes. During 2025, Baginski reported income of $225,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required: Prepare the journal entry to recognize Baginski’s 2025 tax expense or tax benefit. Show the lower portion of the 2025 income statement that reports income tax expense or benefit.
During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss of $405,000 for financial reporting and tax purposes. During 2025, Baginski reported income of $225,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required: 1. Prepare the journal entry to recognize Baginski's 2025 tax expense or tax benefit. 2. Show the lower portion of the 2025 income statement that reports income tax expense or benefit. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Show the lower portion of the 2025 income statement that reports income tax expense or benefit. 0
Sheridan Corporation began operations in 2020 and reported pretax financial income of $212,000 for the year. Sheridan's tax depreciation exceeded its book depreciation by $33,000. Sheridan's tax rate for 2020 and years thereafter is 30%. Assume this is t only difference between Sheridan's pretax financial income and taxable income. Prepare the journal entry to record the income tax expense, deferred income taxes, and income taxes payable. (Credit account titles
Sandhill Corporation began operations in 2020 and reported pretax financial income of $226,000 for the year. Sandhill’s tax depreciation exceeded its book depreciation by $39,000. Sandhill’s tax rate for 2020 and years thereafter is 30%. Assume this is the only difference between Sandhill’s pretax financial income and taxable income.Prepare the journal entry to record the income tax expense, deferred income taxes, and income taxes payable. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount Show how the deferred tax liability will be classified on the December 31, 2020,…
During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss of $360,000 for financial reporting and tax purposes. During 2025, Baginski reported income of $200,000 for financial reporting and tax purposes. The enacted tax rate is 25%. Required: Prepare the journal entry to recognize Baginski’s 2025 tax expense or tax benefit. Show the lower portion of the 2025 income statement that reports income tax expense or benefit.
Sunland Corporation began operations in 2020 and reported pretax financial income of $212,000 for the year. Sunland’s tax depreciation exceeded its book depreciation by $33,000. Sunland’s tax rate for 2020 and years thereafter is 30%. Assume this is the only difference between Sunland’s pretax financial income and taxable income.Prepare the journal entry to record the income tax expense, deferred income taxes, and income taxes payable. Show how the deferred tax liability will be classified on the December 31, 2020, balance sheet. Deferred tax liability should be classified as a a) current asset b) current liability c) non current asset or d) non current liability on the December 31, 2020, balance sheet.

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