Packard Corporation reported a taxable income of $1,000,000 in 20X3and paid federal income taxes of $340,000. Included in thecomputation was a dividend received a deduction of $5,000, a netcapital loss carryover from 20X2 of $10,000, and a gain of $50,000 froman installment sale that took place in 20X1. The corporation's currentearnings and profits for 20X3 would be:A. $1,015,000B. $965,000C. $675,000D. $625,000

Key Adjustments to Taxable IncomeE&P is calculated by adjusting taxable income for certain items…

Answered: Packard Corporation reported a taxable…

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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Assume that a corporation has $100,000 of taxable income from operations plus $5,000 of interest income and $10,000 of dividend income. What is the company’s federal tax liability?
General Accounting
Lanco Corporation, an accrual-method corporation, reported taxable income of $1,720,000 this year and paid Federal income tax of $361,200. Included in the computation of taxable income were the following items: • MACRS depreciation of $253,000. Depreciation for earnings and profits purposes is $124,000. • A net capital loss carryover of $13,700 from last year. • A net operating loss carryover of $31,000 from last year. $76,750 capital gain from the distribution of land to the company's sole shareholder (see below). Not included in the computation of taxable income were the following items: • Tax-exempt income of $8,600. • Life insurance proceeds of $267,000. • Excess current-year charitable contribution of $2,300 (to be carried over to next year). • Tax-deferred gain of $21,300 on a like-kind exchange. • Nondeductible life insurance premium of $4,700. • Nondeductible interest expense of $3,600 on a loan used to buy tax-exempt bonds. . Lanco's accumulated E&P at the beginning of the…
Piper Corp. had a taxable net income of P5,500,000 and total assets of P100 million. It had the following data on expenses for the taxable year. Salary expense, P12,000,000 Rent expense, P2,400,000 Advertising expense, P600,000 Depreciation expense, P500,000 Interest expense, P6,000,000 Interest income, net of 20% final tax, P2,400,000 How much is the regular itemized deductions?
The ABC Corporation has net income reported on its books of $120, 500. For the current year, the corporation had federal income tax expense of $30,000, a net capital loss of $ 8,300, and tax-exempt interest income of $5,300. The company deducted depreciation of $20,000 on its tax return and $15,000 on its books. Calculate the ABC Corporation's taxable income.
Burcham Corporation reported pretax book income of $600,000. The depreciation exceeded book depreciation by $400,000. In addition, the company received $300,000 of tax-exempt municipal bond interest. The company’s prior year tax return showed taxable income of $50,000. Compute the company’s book equivalent of taxable income. Use this number to compute the company’s total income tax provision or benefit.
Lexington Corporation has the following transactions: $750,000 operating income; $580,000 operating expenses; $45,000 municipal bond interest; $120,000 long-term capital gain; and $85,000 short-term capital loss. Assume the same facts except that Lexington's long-term capital gain is $180,000 (instead of $120,000). Compute Lexington's taxable income for the year.
Lanco Corporation, an accrual-method corporation, reported taxable income of $2,020,000 this year. Included in the computation of taxable income were the following items: MACRS depreciation of $301,000. Depreciation for earnings and profits purposes is $193,000. A net capital loss carryover of $20,100 from last year. A net operating loss carryover of $26,500 from last year. $60,600 capital gain from the distribution of land to the company’s sole shareholder (see below). Not included in the computation of taxable income were the following items: Tax-exempt income of $5,300. Life insurance proceeds of $340,000. Excess current-year charitable contribution of $2,600 (to be carried over to next year). Tax-deferred gain of $27,700 on a like-kind exchange. Nondeductible life insurance premium of $2,900. Nondeductible interest expense of $2,100 on a loan used to buy tax-exempt bonds. Lanco's accumulated E&P at the beginning of the year was $2,870,000. During the year, Lanco made the…
Marlin Corporation reported pretax book income of $1,000,000. During the current year, the net reserve for warranties increased by $25,000. In addition, book depreciation exceeded tax depreciation by $100,000. Finally, Marlin subtracted a dividends received deduction of $15,000 in computing its current - year taxable income. Marlin's current income tax expense or benefit would be:
Grand Corporation reported pretax book income of $666,000. Tax depreciation exceeded book depreciation by $ 444,000. In addition, the company received $333,000 of tax-exempt municipal bond interest. The company's prior - year tax return showed taxable income of $55,500. Grand's beginning book (tax) basis in its fixed assets was $ 2,110,000 ($1,888,000) and its ending book (tax) basis is $2, 610,000 ($1,966, 000). Compute the company's current income tax expense or benefit.
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