PT Lebah Sengat’s 2021 journal entry to correct the error of retained earnings account would...
Q: Sweet Inc. incurred a net operating loss of $489,000 in 2020. The tax rate for all years is 20%.…
A: Operating Loss Carry forward: The operating loss is considered as negative taxable income. When the…
Q: In its first three years of operations, Vaden Corp. experienced the following income/(losses):…
A: Amount of loss carryforward will result in creation of deferred tax liability in books as loss will…
Q: Tamarisk Inc. had pretax financial income of $139,400 in 2025. Included in the computation of that…
A: One sort of accounting recognition for taxes that are due in the future but have not yet been…
Q: In 2025, Ivanhoe Company discovered an error while preparing its financial statements. A building…
A: Net income is calculated by subtracting total expenses, including depreciation and income tax, from…
Q: In 2019, the Hermes Corporation failed to record $8,000 in depreciation expense. The error was…
A: Journal entry : A journal entry is a record of the business transactions in the accounting…
Q: Calculate the amount of any temporary differences for 2023. Temporary differences GA 56,000
A: Temporary differences in accounting arise from divergent timings between recognizing revenues,…
Q: Sheridan Inc. reports the following pretax income (loss) for both book and tax purposes. Year 2023…
A: The deferred tax asset is created when the taxes to be paid as per income tax are lower than the…
Q: Splish Inc. incurred a net operating loss of $515,000 in 2025. The tax rate for all years is 20%.…
A: A corporation experiences a net operational loss during the tax year in which its deductions (such…
Q: At the beginning of 2025, Whispering Construction Company changed from the cost-recovery method to…
A: A journal entry in accounting is a documentation of a business's financial transaction. It entails…
Q: The Richards Company paid for a five-year extended warranty on all of their equipment on March 1,…
A: Given that, Richard company paid five years warranty on all of their equipment on March 1, 2019…
Q: In 2020 Ferrari Inc. suffer the loss of $100,000. the enacted tax rate is 25%. prepare the companies…
A: Step 1Since, Ferrari Inc has suffered a loss of $100,000 in the year and it would be able to offset…
Q: During 2021, its first year of operations, Sherrod, Inc. reported a net operating loss of $5 million…
A: While carrying out a business profit or loss may occur. If there is any net operating loss can…
Q: Compute the indirect effect of Bramble’s change in accounting principle that will be reported in the…
A: The change in accounting principle for the purpose of financial statement, will increase the net…
Q: Bonita Company reports pretax financial income of $76,500 for 2020. The following items cause…
A: Taxable income: It is the income calculated as per the tax laws and on which the applicable tax…
Q: Sheridan Co. purchased machinery that cost $3250000 on January 4, 2019. The entire cost was recorded…
A: If there is an error in recording the amount of any transaction then in the future it will be…
Q: On January 1, 2021, Sheridan, Inc. purchased a machine for $2180000 which will be depreciated…
A: Solution Concept If in case due to temporary difference The income for tax reporting is less than…
Q: For the year ended December 31, 2023, Crane Ltd. reported income before income taxes of $82,000. In…
A: First of all we have to understand that certain deductions in income tax are not allowed although we…
Q: Shimei Inc. purchased computer equipment on March 1, 2020, for $31,000. The computer equipment has a…
A: Depreciation: Depreciation expense is a non-cash expense, which is recorded on the income…
Q: In 2018, Ryan Management collected rent revenue for 2019 tenant coccupancy. For financial reporting,…
A: Deferred Tax Deferred tax is an amount that is, computed on the basis of tax liability on the income…
Q: Due to an error in computing depreciation expense, Crote Corporation understated accumulated…
A: Paid in capital means the amount contributed by share holder in company as share capitalRetained…
Q: During 2021, its first year of operations, Baginski Steel Corporation reported a net operating loss…
A: Journal Entry: A journal entry refers to the logging of a operations into accounting items of…
Q: In 2021, Winslow International, Inc.’s controller discovered that ending inventories for 2019 and…
A: Overstated ending inventory for 2020 would decrease the cost of goods sold and increase the net…
Q: In 2020, Lambeau Inc. suffered a loss of $250,000. The enacted tax rate is 25%. Prepare Lambeau's…
A: Tax loss carry forward is when net operating loss is a year is carried forward to reduce taxable…
Q: Nash, Inc., changed from the LIFO cost flow assumption to the FIFO cost flow assumption in 2020. The…
A: When Change of Inventory causes increases in Income then Inventory Increases to that extent and and…
Q: 1. Prepare the journal entry to recognize Baginski's 2025 tax expense or tax benefit. 2. Show the…
A: When a business has a net operating loss (NOL) for a given tax year, it means that its taxable…
Q: A wholesale business with a December 31 year-end purchased new equipment on November 25, 2021, for…
A: To calculate the tax consequences of selling the equipment in 2023 for different amounts, we need to…
Q: Kyle Inc. incurred a net operating loss of $580, 000 in 2023. Combined income for 2020, 2021, and…
A: Loss carryback is a tax provision that allows a business to use a current year's net operating…
Q: Bonita, Inc., changed from the LIFO cost flow assumption to the FIFO cost flow assumption in 2025.…
A: Given are:Increase in inventory = $1,300,500Tax rate = 20% Deferred tax liability = Inventory x Tax…
Q: Cullumber Co. purchased machinery that cost $3600000 on January 4, 2019. The entire cost was…
A: Depreciation is the loss in the value of the asset caused due to its usage, wear and tear. There are…
Q: The following information is available for Wenger Corporation for 2019 (its first year of…
A: aCompute taxable income for 2019.
Q: In 2017, Marigold Company discovered that equipment purchased on January 1, 2016, for $55,100 was…
A: Journal: Recording of a business transactions in a chronological order.
Q: rd Fauntleroy Co. purchased machinery that cost $3,000,000 on January 4, 2019. The entire cost was…
A: Given, cost of equipment = $3,000,000Estimated useful life = 9 yearsResidual value =…
Q: At Carla Vista Co., events and transactions during 2020 included the following. The tax rate for all…
A: Taxes are the amount of dues or liabilities that is to be paid by individual on account of income…
Q: A company reports 2024 pretax accounting income of $10 million, but because of a single temporary…
A: Income Tax Accounting involves the systematic recording and reporting of a company's financial…
Q: During an audit of Madison Company's December 31, 2020 records it was discovered that the company…
A: Journal entry is the procedure for initially documenting commercial transactions in the books of…
Q: Required: - Prepare the journal entry to recognize Baginski’s 2025 tax expense or tax benefit. -…
A: If a company experiences a financial loss during a specific fiscal period, it has the opportunity to…
Q: During an audit of Madison Company’s December 31, 2020 records it was discovered that the company…
A: As per IAS 8,Accounting policies, changes in Accounting estimates and errors Prior period errors…
Q: K had income from continuing operations of P800,000 (after taxes) in 2021. In addition, the…
A: GIVEN ÷ income from continuing operations (after taxes) = P800000 loss on inventory = P200,000 loss…
Q: Early in January 2019, Oler, Inc., purchased equipment costing $24,000. The equipment had a 2‑year…
A: Working Notes: 1. In 2019, Deferred tax liability (temporary difference will be $24,000 - $12,000) =…
Q: At December 31, 2020, Sheridan Corporation has a deferred tax asset of $180,000. After a careful…
A: Given, Deferred tax asset as on Dec 31, 2020 = $180,000 Deferred tax asset will not be realized =…
Q: During an audit of Madison Company’s December 31, 2020 records it was discovered that the company…
A: Introduction:- A journal entry is used in a company ’s financial statements to record a business…
Q: During 2024, its first year of operations, Baginski Steel Corporation reported a net operating loss…
A: The deferred tax asset is created when the taxes to be paid as per income tax are lower than the…
Q: s pretax financial income of $68,400 for 2020. The following items cause taxable income to be…
A: The answers have been mentioned below.
In 2019, PT Lebah Sengat discovered that equipment purchased on January 1,2019, for €52,500 was expensed at that time. The equipment should have been
![](/static/compass_v2/shared-icons/check-mark.png)
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
- The following information is available for Sandhill Corporation for 2019 (its first year of operations). 1. Excess of tax depreciation over book depreciation, $40,400. This $40,400 difference will reverse equally over the years 2020–2023. 2. Deferral, for book purposes, of $19,900 of rent received in advance. The rent will be recognized in 2020. 3. Pretax financial income, $284,700. 4. Tax rate for all years, 20%.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. 0In 2025, Sandhill Company discovered an error while preparing its 2025 financial statements. A building constructed at the beginning of 2024 costing $1299900 has not been depreciated. The estimated useful life of the building is 30 years with no salvage value. Straight-line depreciation is used. Sandhill properly included depreciation on its tax return also using straight-line depreciation. Income tax payable was also reported correctly at a tax rate of 20%. Income before depreciation expense in 2025 was $400000. What was the impact on the following accounts at the start of 2025? Accumulated Depreciation was understated by $86660 and Retained Earnings was overstated by $34664. O Accumulated Depreciation was understated by $43330 and Retained Earnings was overstated by $34664. O Accumulated Depreciation was overstated by $43330 and net income was understated by $43330. O Accumulated Depreciation was understated by $43330 and net income was overstated by $43330.
- Sandhill, Inc., changed from the LIFO cost flow assumption to the FIFO cost flow assumption in 2020. The increase in the prior year's income before taxes is $1,127,000. The tax rate is 20%. Prepare Sandhill's 2020 journal entry to record the change in accounting principle. (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 CreditPronghorn Inc. incurred a net operating loss of $583,900 in 2023. Combined income for 2020, 2021, and 2022 was $464,400. The tax rate for all years is 30%. Assume that it is more likely than not that the entire tax loss carryforward will not be realized in future years. Assume that Pronghorn earns taxable income of $20,300 in 2024 and that at the end of 2024 there is still too much uncertainty to recognize a deferred tax asset. (a) Prepare the journal entries that are necessary at the end of 2024 assuming that Pronghorn does not use a valuation allowance account. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Year Account Titles and Explanation 2024 2024 (To record current tax expense) (To record current tax benefit) Debit CreditIn 20X6, Dalia Corp., a calendar fiscal-year company, discovered that depreciation expense was erroneously overstated $67,000 in both 20X4 and 20X5 for financial reporting purposes. Net income in 20X6 is correct. The tax rate is 25%. The error was made only for financial reporting, affecting depreciation and deferred income tax accounts. CCA had been recorded correctly, and thus there will be no change in taxes payable. Additional Information: 20X6 20X5 Beginning retained earnings $454,000 $430,400 Earnings (includes error in 20X5) Dividends declared 85,400 95,900 62,200 72,300
- In 2021, Winslow International, Inc.’s controller discovered that ending inventories for 2019 and 2020 were overstated by $220,000 and $520,000, respectively.Determine the effect of the errors on retained earnings at January 1, 2021. (Ignore income taxes.)Wildhorse Co. purchased machinery that cost $2850000 on January 4, 2019. The entire cost was recorded as an expense. The machinery has a 9-year life and a $185000 residual value. The error was discovered on December 20, 2021. Ignore income tax considerations.Wildhorse's income statement for the year ended December 31, 2021, should show the cumulative effect of this error in the amount ofDuring 2021, a construction company that began operations in 2019 changed from the completed-contract method to the percentage-of-completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion 2019 $ 385000 $ 790000 2020 525000 850000 2021 600000 950000 $1510000 $2590000 Assuming an income tax rate of 30% for all years and that comparative statements are not issued, the effect of this accounting change on prior periods should be reported by a increase of $511000 on the 2021 income statement. $755000 on the 2021 retained earnings statement. $511000 on the 2021 retained earnings statement. $755000 on the 2021 income statement.
- Gardiner, Inc. reported a retained earnings balance of $190,000 at December 31, 2024. In June 2025, Gardiner discovered that merchandise costing $20,000 had been improperly included in ending inventory in its 2024 financial statements. Also, a $50,000 accrued expense was omitted on 12/31/24. Gardiner has a 20% tax rate. Assuming the correcting journal entry net of tax was recorded, what amount should Gardiner report as adjusted beginning retained earnings in its 2025 statement of retained earnings? Select one: O a. $226,000 O b. $120,000 C. $166,000 d. $160,000 e. $134,000Penny Company purchased equipment on 1/1/21 for $50,000. The company mistakenly expensed the entire cost although the equipment had a 5-year useful life. The error was discovered in 2023 before the books are closed and depreciation expense was appropriately recorded for the current 2023 year. In 2023 and 2022 comparative financial statements, a Prior Period Adjustment would be recognized as follows(ignore income tax effects): O 2023: $20,000; 2022: $30,000. O 2023: -0-; 2022: $30,000. O 2023: $10,000; 2022: $10,000. O 2023: -0-; 2022: $40,000.During an audit of Madison Company’s December 31, 2020 records it was discovered that the company did not accurately accrue for $12,500 of depreciation expense. The accrual of interest expense of $4,500 was also omitted. These errors occurred in 2019 and have a material impact on Madison’s financial records. Madison’s net income for the year was $123,000. The company is subject to a 35% tax rate. The company had a retained earnings balance of $557,500 on January 1, 2020. No dividends were paid. Required: 1. Prepare the necessary journal entries to correct the accounting records of Madison Company’s books. 2. Prepare the statement of retained earnings for 2020. 1. Prepare the necessary journal entries to correct the accounting records of Madison Company’s books. For grading purposes, prepare four separate entries dated December 31. General Journal Instructions PAGE 1 GENERAL JOURNAL DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT 1 2…
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)