If the alternative minimum tax provisions are ignored, what amount should Packer report as taxable income? Packer Co.'s 2015 income statement reported $130,000 in incomebefore provisions for income taxes. To compute the provision for federalincome taxes, the following 2015 data are provided:Rent received in advanceIncome from exempt municipal bonds$ 22,000$ 17,000Depreciation deduced for income tax purposes$ 18,000Depreciation deducted for financial purposes$ 10,000If the alternative minimum tax provisions are ignored, what amountshould Packer report as taxable income?a. $125,000b. $117,000c. $127,000d. $130,000

To determine taxable income, we need to adjust income before provisions for income taxes (reported…

Answered: Packer Co.'s 2015 income statement…

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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Vasquez Corp.'s 2017 income statement showed pretax accounting income of $2,040,000. To compute the federal income tax liability, the following 2017 data are provided: Income from exempt municipal bonds $ 110,000 Depreciation deducted for tax purposes in excessof depreciation deducted for financial statement purposes 144,000 Estimated federal income tax payments made 330,000 Enacted corporate income tax rate 30% What amount of current federal income tax liability should be included in Vasquez's December 31, 2017 balance sheet?
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For the year ended December 31, 2015, Pering Co. reported pretax financial income of $550,000. Its current tax expense was $144,000. Pering reported a difference between pretax financial statement income and taxable income. This difference is due to accelerated depreciation for income tax purposes. Pering?s effective income tax rate is 30% and Pering made estimated tax payments during 2015 of $75,000. What amount did Paring report as taxable income for 2015? a. $405,000 b. $475,000 c. $480,000 d. $550,000
CSX Corporation reported the following in its tax footnote to its 2019 financial statements. Use this information to answer the requirements. $ millions Net income Interest expense, net 737 639 546 Average total assets 37,493 36,234 35,577 Compute (a) return on assets and (b) the adjusted return on assets for each of the three years. Assume a statutory tax rate of 37% for 2017 and 22% for 2018 and 2019. a. Compute return on assets (ROA) for 2017, 2018, and 2019 Note: 1. Select the appropriate numerator and denominator used to compute ROA from the drop-down menu options. 2. Enter the numerator and denominator amounts to compute ROA for each year. Year Numerator Net income 2019 2018 2017 $3,331 $3,309 $5,471 2017 $ 2018 $ 2019 $ 2017 $ 2018 S 2019 $ Denominator + Average total assets ÷ 35,577 5,471 $ 3,309 $ 3,331 $ ÷ b. Compute adjusted return on assets (ROA) for 2017, 2018, and 2019 Note: 1. Select the appropriate numerator and denominator used to compute adjusted ROA from the…
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Ehrlich Company had the following information for 2021. 1. Pretax financial income for 2021 is $100,000. 2. The tax rate enacted for 2021 and future years is 20%. 3. Differences between the 2021 income statement and tax return are listed below: a. Warranty expense accrued for financial reporting purposes amounts to $7,000. Warranty deductions per the tax return amount to $2,000. b. Gross profit on construction contracts using the percentage-of-completion method per books amounts to $92,000. Gross profit on construction contracts for tax purposes amounts to $67,000. c. Depreciation of property, plant, and equipment for financial reporting purposes amounts to $60,000. Depreciation of these assets amounts to $80,000 for the tax return. d. A $3,500 fine paid for violation of pollution laws was deducted in computing pretax financial income. e. Interest revenue recognized on an investment in tax-exempt municipal bonds amounts to $1,500. Instructions: a. Compute…
Carla reported the following pretax financial income (loss) for the years 2015-2019. 2015 $235,000 2016 343,000 2017 98,000 2018 (511,000) 2019 176,000 ) Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2015 and 2016, and 40% for 2017-2019. Assume the carryback provision is used first for net operating losses A.) Prepare the journal entries for the years 2017-2019 to record income tax expense, income taxes payable (refundable), and the tax effects of the loss carryback and loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-fifth of the benefits of the loss carryforward will not be realized. B.) Prepare the income tax section of the 2018 income statement beginning with the line "Income (loss) before income taxes."

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