N5.Account Timpanogos Inc. is an accrual-method calendar-year corporation. For 2017, it reported financial statement income aftertaxes of $1,452,000. Timpanogos provided the following information relating to its 2017 activities:Life insurance proceeds as a result of CEO's deathRevenue from sales (for both book and tax purposes)Premiums paid on the key-person life insurance policies. The policies have no cash surrender value.Charitable contributionswwwAUCACO anyInterest income on private activity tax-exempt bonds issued in 2014.AUCOLO paid onInterest paid on loan obtained to purchase tax-exempt bondsRental income payments received and earned in 2017Rental income payments received in 2016 but earned in 2017.Rental income payments received in 2017 but not earned by year-endMACRS depreciationBook DepreciationAlternative minimum tax depreciationNet capital lossFederal income tax expense for books in 2017Timpanogos did not qualify for the domestic production activities deduction. Corporate tax schedule (Leave no answerblank. Enter zero if applicable.)Required:a. Reconcile book income to taxable income for Timpanogos Inc. Be sure to start with book income and identify all of the adjustmentsnecessary to arrive at taxable income.d. Compute Timpanogos Inc.'s regular tax liability.e. Determine Timpanogos's alternative minimum tax, if any.200,0002,000,00021,000180,00040.00040,000****45,000****15,00020700010,00030,00055,00025,00050,00042,000500,000

Regular Tax Liability: Regular Tax Liability refers to the amount of tax owed by an individual or a…

Required: a. Reconcile book income to taxable income for Timpanogos Inc. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. d. Compute Timpanogos Inc.'s regular tax liability. e. Determine Timpanogos's alternative minimum tax, if any.

Required: a. Reconcile book income to taxable income for Timpanogos Inc. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. d. Compute Timpanogos Inc.'s regular tax liability. e. Determine Timpanogos's alternative minimum tax, if any.

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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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

N5.

Account

Timpanogos Inc. is an accrual-method calendar-year corporation. For 2017, it reported financial statement income after
taxes of $1,452,000. Timpanogos provided the following information relating to its 2017 activities:
Life insurance proceeds as a result of CEO's death
Revenue from sales (for both book and tax purposes)
Premiums paid on the key-person life insurance policies. The policies have no cash surrender value.
Charitable contributions
www
AUCACO any
Interest income on private activity tax-exempt bonds issued in 2014.
AUCOLO paid on
Interest paid on loan obtained to purchase tax-exempt bonds
Rental income payments received and earned in 2017
Rental income payments received in 2016 but earned in 2017.
Rental income payments received in 2017 but not earned by year-end
MACRS depreciation
Book Depreciation
Alternative minimum tax depreciation
Net capital loss
Federal income tax expense for books in 2017
Timpanogos did not qualify for the domestic production activities deduction. Corporate tax schedule (Leave no answer
blank. Enter zero if applicable.)
Required:
a. Reconcile book income to taxable income for Timpanogos Inc. Be sure to start with book income and identify all of the adjustments
necessary to arrive at taxable income.
d. Compute Timpanogos Inc.'s regular tax liability.
e. Determine Timpanogos's alternative minimum tax, if any.
200,000
2,000,000
21,000
180,000
40.000
40,000
****
45,000
****
15,000
207000
10,000
30,000
55,000
25,000
50,000
42,000
500,000

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