Question 8 Flint Corporation has historically followed ASPE, but is considering a change to IFRS. It has temporary differences at December 31, 2020, that result in the following SFP future income tax accounts: Deferred tax liability, current Deferred tax asset, current Deferred tax liability, non-current Deferred tax asset, non-current $30,600 $50,500 $91,000 $23,700 Your answer is correct. Indicate how these balances will be presented in Flint's December 31, 2020 SFP, assuming that Flint reports under the ASPE future income taxes method.

Question 8 Flint Corporation has historically followed ASPE, but is considering a change to IFRS. It has temporary differences at December 31, 2020, that result in the following SFP future income tax accounts: Deferred tax liability, current Deferred tax asset, current Deferred tax liability, non-current Deferred tax asset, non-current $30,600 $50,500 $91,000 $23,700 Your answer is correct. Indicate how these balances will be presented in Flint's December 31, 2020 SFP, assuming that Flint reports under the ASPE future income taxes method.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Shwonson Industries reported a deferred tax asset of $9.75 million for the year ended December 31, 2020, related to a temporary difference of $39 million. The tax rate was 25%. The temporary difference is expected to reverse in 2022, at which time the deferred tax asset will reduce taxable income. There are no other temporary differences in 2020–2022. Assume a new tax law is enacted in 2021 that causes the tax rate to change from 25% to 15% beginning in 2022. (The rate remains 25% for 2021 taxes.) Taxable income in 2021 is $49 million. Required:1. Prepare the appropriate journal entry to record Shwonson’s income tax expense in 2021.2. What effect, will enacting the change in the 2022 tax rate, have on Shwonson’s 2021 net income?
Concord Construction Company changed from the completed-contract to the percentage-of-completion method of accounting for long-term construction contracts during 2021. For tax purposes, the company employs the completed-contract method and will continue this approach in the future. (Hint: Adjust all tax consequences through the Deferred Tax Liability account.) The appropriate information related to this change is as follows. Pretax Income from: Percentage-of-Completion Completed-Contract Difference 2020 $747,000 $539,000 $208,000 2021 673,000 468,000 205,000 (a) Assuming that the tax rate is 30%, what is the amount of net income that would be reported in 2021?
Youngman Corporation has temporary differences at December 31, 2020, that result in the following deferred taxes. Deferred tax asset $24,000 Deferred tax liability 69,000 Indicate how these balances would be presented in Youngman's December 31, 2020, statement of financial position.
Select the best answer to the tax credit and corporate and partnership income tax issues. Mamey, Inc. had taxable income of $138,500 in 2020. What is the income tax expense for the year 2020? a. $29,085 b. $25,623 c. $34,625 d. $27,700 Which of the following items might not generally appear on the Schedule M-1 reconciliation a. Exempt interest income b. Meal expenses c. Office material expenses d. Federal income tax expense Cubey Industries, Inc. has a net book income of $76,100. For the year it had an income tax expense of $18,900. During the year Cubey received pandemic exempt income of $5,000 and had total food expense of $1,000 on books. What is the result of the Schedule M-1 reconciliation per Schedule line 10. a. $81,600 b. $90,500 c. $95,500 d. $95,000 The net operating losses (NOLs) that a corporation has available to be used against taxable income for the year 2020 are subject to a. A limitation of 90% of taxable income b.…
Balance Sheet Presentation Thiel Company reports the following deferred tax items at the end of 2019: Deferred TaxItem # AccountBalance Related Asset or LiabilityCreating the Deferred Tax Item 1 $6,700 debit Current asset 2 7,200 credit Current liability 3 10,600 debit Noncurrent asset 4 15,500 credit Noncurrent liability Required: Show how the preceding deferred tax items are reported on Thiel's December 31, 2019, balance sheet. THIEL COMPANYBalance Sheet (Tax Items)December 31, 2019 Noncurrent Liabilities Deferred Tax asset or liability $
Buffalo Company has the following two temporary differences between its income tax expense and income taxes payable. 2020 2021 2022 Pretax financial income $811,000 $932,000 $992,000 Excess depreciation expense on tax return (31,500 ) (39,100 ) (9,900 ) Excess warranty expense in financial income 19,900 9,800 8,300 Taxable income $799,400 $902,700 $990,400 The income tax rate for all years is 20%. (a) Your Answer Correct Answer (Used) Assuming there were no temporary differences prior to 2020, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020, 2021, and 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit…
Required information Problem 16-8 Multiple differences; taxable income given; two years; balance sheet classification; change in tax rate [LO16-4, 16-6, 16-8] [The following information applies to the questions displayed below.] Arndt, Inc., reported the following for 2018 and 2019 ($ in millions): 2018 2019 Revenues $ 995 $1,073 Expenses Pretax accounting income (income statement) Taxable income (tax return) 800 840 $ 195 $ 195 233 $ 245 Tax rate: 40% a. Expenses each year include $30 million from a two-year casualty insurance policy purchased in 2018 for $60 million. The cost is tax deductible in 2018. b. Expenses include $2 million insurance premiums each year for life insurance on key executives. c. Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2018 and 2019 were $39 million and $57 million, respectively. Subscriptions included in 2018 and 2019 financial reporting revenues were $36 million ($14 million collected in 2017 but not…
Q1. Taxable income and applicable tax rates for C.J. Company’s first four years are shown below. For each year, taxable income and pretax financial income are identical. In the table below, taxable income is before any consideration of NOL carryback and carryforward. The enacted tax rates were known at 1/1/2018. Taxable Income Enacted tax rate 2018 $200 20% 2019 ($300) 15% 2020 $340 25% 2021 $210 25% Now assume that C.J. opted to carryback its 2019 NOL and carryforward any unused NOL to future years. Complete the table below for 2018 through 2021 to show the amount of income tax payable to the IRS or the refund due from the IRS for each year. Put your answer in the table below. Show tax payable as a positive number and tax refund as a negative number. Year Tax…
Shwonson Industries reported a deferred tax asset of $5 million for the year ended December 31, 2020, related to a temporary difference of $20 million. The tax rate was 25%. The temporary difference is expected to reverse in 2022, at which time the deferred tax asset will reduce taxable income. There are no other temporary differences in 2020–2022. Assume a new tax law is enacted in 2021 that causes the tax rate to change from 25% to 15% beginning in 2022. (The rate remains 25% for 2021 taxes.) Taxable income in 2021 is $30 million.Required:Determine the effect of the tax rate change and prepare the appropriate journal entry to record Shwonson’s income tax expense in 2021. What effect, if any, will enacting the change in the 2022 tax rate have on Shwonson’s 2021 net income?
Operating income and tax rates for Carla Vista Company's first three years of operations were as follows: 2020 2021 2022 O Income $350000 ($950000) $1630000 Amount $190000 Assuming that Carla Vista Company opts only to carryforward its 2021 NOL, what is the amount of deferred tax asset or liability that Carla Vista Company would report on its December 31, 2021 balance sheet? $285000 $237500 Enacted tax rate $190000 25% 20% 30% Deferred tax asset or liability Deferred tax liability Deferred tax asset Deferred tax liability Deferred tax asset
Sheridan Company reported the following results for the year ended December 31, 2020, its first year of operations: Income (per books before income taxes) $3343000 Taxable income 4466000 The disparity between book income and taxable income is attributable to a temporary difference, which will reverse in 2021. What should Sheridan record as a net deferred tax asset or liability for the year ended December 31, 2020, assuming that the enacted tax rates in effect are 35% in 2020 and 30% in 2021? O $393050 deferred tax liability $336900 deferred tax liability $393050 deferred tax asset $336900 deferred tax asset
Mallock Incorporated reports net operating income (loss) for financial reporting and tax purposes in each year as follows ($ in thousands): 2016 $ 160 2017 $ 50 2018 $ 0 2019 2020 $ 0 $ (240) Mallock's federal tax rate decreased from 35% to 21% starting in 2018. Mallock accounts for its 2020 NOL under the CARES Act. Required: 1. Prepare the appropriate journal entry to record Mallock's 2020 income taxes. 2. Show the lower portion of the 2020 income statement that reports income tax expense or benefit. Complete this question by entering your answers in the tabs below.