Required information [The following information applies to the questions displayed below.] Hafnaoui Company reported pretax net income from continuing operations of $903,500 and taxable income of $712,500. The book-tax difference of $191,000 was due to a $242,000 favorable temporary difference relating to depreciation, an unfavorable temporary difference of $117,000 due to an increase in the reserve for bad debts, and a $66,000 favorable permanent difference from the receipt of life insurance proceeds. Compute Hafnaoui Company's deferred income tax expense or (benefit). te: Enter all numbers as a positive number and indicate whether a deferred tax expense or a deferred tax benefit. Answer is complete but not entirely correct. S 712,500 X Deferred income tax expense

Required information [The following information applies to the questions displayed below.] Hafnaoui Company reported pretax net income from continuing operations of $903,500 and taxable income of $712,500. The book-tax difference of $191,000 was due to a $242,000 favorable temporary difference relating to depreciation, an unfavorable temporary difference of $117,000 due to an increase in the reserve for bad debts, and a $66,000 favorable permanent difference from the receipt of life insurance proceeds. Compute Hafnaoui Company's deferred income tax expense or (benefit). te: Enter all numbers as a positive number and indicate whether a deferred tax expense or a deferred tax benefit. Answer is complete but not entirely correct. S 712,500 X Deferred income tax expense

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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Pina Colada Corp. has income from continuing operations of $413,000 for the year ended December 31, 2022. It also has the following items (before considering income taxes). 1. An unrealized loss of $64,600 on available-for-sale securities. 2. A gain of $26,400 on the discontinuance of a division (comprised of a $9,100 loss from operations and a $35,500 gain on disposal). Assume all items are subject to income taxes at a 20% tax rate.Prepare a partial income statement, beginning with income from continuing operations, and a statement of comprehensive income. PINA COLADA CORP.Partial Income Statement choose the accounting period select an income statement item $enter a dollar amount select an income statement item select an income statement item…
Pine Ltd is reviewing its deferred tax for the year. In each of the following situations prepare the end-of-period adjustment journal entries to account for income tax on the initial appearance or reversal of any temporary differences. Explain in each case why particular accounts are affected. 1.The company purchased a depreciable asset at the beginning of the year for $200 000. For accounting purposes, an annual depreciation rate of 20% straight-line is used, whereas for taxation the rate is 30% straight-line. 2.The company’s provision for long-service leave at the beginning and end of the year are $80 000 and $77 500 respectively. In the current year, $10 000 in long-service leave was paid to a long-standing employee. 3. The company has interest receivable of $25 000 at the end of the year. No interest was receivable at the beginning of the year. Interest income is included in taxable profit only when received. 4.The company has revalued land at the end of the year. The…
Livia Company’s pretax income was $72,000. To compute taxable income, the following information is provided: Excess of estimated bad debts over write-offs $26,000 Penalty for late filing of income taxes 21,000 Excess of tax depreciation over accounting depreciation 36,000 Tax rate 20% What is the current portion of income tax? $12,400 $6200 $16,600 $22,600
Please answer in good accounting form. Thankyou
Required information Use the following information for the Exercies below. (Algo) [The following information applies to the questions displayed below.] In the current year, Randa Merchandising Incorporated sold its interest in a chain of wholesale outlets, taking the company completely out of the wholesaling business. The company still operates its retail outlets. A listing of the major sections of an income statement follows. Debit Item 1. Net sales. 2. Gain on state's condemnation of company property 3. Cost of goods sold 4. Income tax expense 5. Depreciation expense 6. Gain on sale of wholesale business segment, net of tax 7. Loss from operating wholesale business segment, net of tax 8. Loss of assets from meteor strike $ 1,786,000 262,000 280,000 536,000 772,000 Credit $ 3,500,000 278,000 935,000
am.115.
Munabhai
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $ 265,000 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its deferred income tax liability as of the end of its first year of operations?
11. Ace Company had a pretax accounting income of P5,000,000 for its first year of operations. The following differences are noted between accounting income and taxable income: 1) Nondeductible expenses - 200,000; 2) Nontaxable revenue - 500,000; 3) Gross income on installment sales reported in accounting income but not in taxable income - 1,000,000; 4) Provision for doubtful accounts - 100,000; and 5) Income tax rate - 30%. COMPUTE THE FOLLOWING: 1. Accounting income subject to tax; 2) Taxable income; 3) Total income tax expense; and 4) Current tax expense.
Hopkins Co. at the end of 2010, its first year of operations, prepared a reconciliation between pretar financial income and taxable income as follows: Pretax financial income S 750.000 Estimated litigation expense 1,000,000 Extra depreciation for taxes (1.500.000) Taxable income 5.250.000 The estimated litigation expense of $1,000,000 will be deductible in 2011 when it is expected to be paid. Use of the depreciable assets will result in taxable amounts of $500,000 in each of the next three years. The income tax rate is 30% for all years. Income tax payable is Select one: a. $75,000. b. S0. C $150,000. d. $225,000.
Required information [The following information applies to the questions displayed below.] Last year, Cougar Corporation (CC) reported a net operating loss of $25,000. In the current year, CC expected its current- year tax liability to be $260,000, so it made four equal estimated tax payments of $65,000 each. Cougar closed its books at the end of each quarter. The following schedule reports CC's taxable income at the end of each quarter: Quarter-End First Second Third Fourth Cumulative Taxable Income $ 300,000 700,000 1,000,000 1,500,000 CC's current-year tax liability on $1,500,000 of taxable income is $315,000. a. Does CC owe underpayment penalties on its estimated tax payments?
Hafnaoui Company reported pretax net income from continuing operations of $912,000 and taxable income of $587,500. The book–tax difference of $352,500 was due to a $235,000 favorable temporary difference relating to depreciation, an unfavorable temporary difference of $94,000 due to an increase in the reserve for bad debts, and a $211,500 favorable permanent difference from the receipt of life insurance proceeds. At the end of the year, the reserve for bad debts had a balance of $117,500; the beginning balance in the account was $23,500. Hafnaoui's beginning book (tax) basis in its fixed assets was $1,014,000 ($821,000) and its ending book (tax) basis is $1,535,000 ($1,107,000). a. Compute Hafnaoui Company's current income tax expense. b. Compute Hafnaoui Company's deferred income tax expense or benefit. c. Compute Hafnaoui Company's effective tax rate. d. Provide a reconciliation of Hafnaoui Company's effective tax rate with its hypothetical tax rate of 21 percent.