Q.Hunt Co began operations in 2025. Estimated warranty expense of $800,000 will be deductible in 2026, $300,000 in 2027, and $100,000 in 2028. The use of the depreciable assets will result in taxable amounts of $650,000 in each of the next three years. Pretax financial income was $950,000. Instructions (a) Prepare a table of future taxable and deductible amounts. (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming an income tax rate of 20% for all years.

Q.Hunt Co began operations in 2025. Estimated warranty expense of $800,000 will be deductible in 2026, $300,000 in 2027, and $100,000 in 2028. The use of the depreciable assets will result in taxable amounts of $650,000 in each of the next three years. Pretax financial income was $950,000. Instructions (a) Prepare a table of future taxable and deductible amounts. (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming an income tax rate of 20% for all years.

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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Oriole Co. at the end of 2021, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $ 690,000 Estimated warranty expenses deductible for taxes when paid 1,140,000 (1,632,000) $ 198,000 Extra depreciation Taxable income Estimated warranty expense of $830,000 will be deductible in 2022, $240,000 in 2023, and $70,000 in 2024. The use of the depreciable assets will result in taxable amounts of $544,000 in each of the next three years. Prepare a table of future taxable and deductible amounts. 2022 Future taxable(deductible) amounts Warranties Excess Depreciation Date 2023 Account Titles 2024 Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2021. Assuming an income tax rate of 30% for all years. TOTAL Debit Credit
kit Company borrows $6 million at 12% on January 1, 2019, specifically for the purpose of financing the construction of a building that is expected to take 18 montns to complete. Kit invests the total amount at 11 % until it makes payments for the construction project. During the first year of construction, kit incurs the following expenditures related to this construction project: 1. Compute the amount of interest expense Kit would capitalize related to the construction of the building. 2. Compute the amou1nt of interest revenue kit would recognize. 3. Assume that kit uses IFRS. what amount of interest would be capitalized related to the construction of the building?
Subject: acounting
On January 1, 2024, the Marjlee Company began construction of an office building to be used as its corporate headquarters. The building was completed early in 2025. Construction expenditures for 2024, which were incurred evenly throughout the year, totaled $6,000,000. Marjlee had the following debt obligations which were outstanding during all of 2024: Construction loan, 11% Long-term note, 10% Long-term note, 7% Required: Calculate the amount of interest capitalized in 2024 for the building using the specific interest method. Interest capitalized $ 1,500,000 2,000,000 4,000,000 $ 255,000
The Wes Trust reports $93,600 of AMT income before the annual exemption. Round any computations and final answer to the nearest dollar. The entity's AMT for 2021 is.................
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