Revenues Expenses Pre-tax income For tax purposes, the following income tax differences existed: a. Revenues on the 20X9 statement of profit and loss include $47,000 rent, which is taxable in 20X8 but was unearned at the end of 20X8 for accounting purposes. b. Expenses on the 20X9 statement of profit and loss include political contributions of $17,500, which are not deductible for income tax purposes. c. Expenses on he 20X8 statement of profit and loss include $21,900 estimated warranty costs, which are not deductible for income tax purposes until 20X9. Year 20X8 $286, 000 191, 000 $ 95,000 Required: 1. What was the accounting carrying value and tax basis for unearned revenue and the warranty liability at the end of 20X8 and 20X9? (Leave no cells blank - be certain to enter "0" wherever required.) Accounting carrying value Tax basis 20X9 $350,000 247, 000 $103, 000 a. Income tax payable b. Deferred income tax c. Total income tax expense 20x8 20X9 Unearned Rent Warranty Unearned Rent 2. Compute (a) income tax payable, (b) deferred income tax, and (c) income tax expense for each period. Assume a tax rate of 30%. (Amounts to be deducted should be indicated by a minus sign.) 20X8 Warranty 20X9
Revenues Expenses Pre-tax income For tax purposes, the following income tax differences existed: a. Revenues on the 20X9 statement of profit and loss include $47,000 rent, which is taxable in 20X8 but was unearned at the end of 20X8 for accounting purposes. b. Expenses on the 20X9 statement of profit and loss include political contributions of $17,500, which are not deductible for income tax purposes. c. Expenses on he 20X8 statement of profit and loss include $21,900 estimated warranty costs, which are not deductible for income tax purposes until 20X9. Year 20X8 $286, 000 191, 000 $ 95,000 Required: 1. What was the accounting carrying value and tax basis for unearned revenue and the warranty liability at the end of 20X8 and 20X9? (Leave no cells blank - be certain to enter "0" wherever required.) Accounting carrying value Tax basis 20X9 $350,000 247, 000 $103, 000 a. Income tax payable b. Deferred income tax c. Total income tax expense 20x8 20X9 Unearned Rent Warranty Unearned Rent 2. Compute (a) income tax payable, (b) deferred income tax, and (c) income tax expense for each period. Assume a tax rate of 30%. (Amounts to be deducted should be indicated by a minus sign.) 20X8 Warranty 20X9
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Subject: accounting
![Revenues
Expenses
Pre-tax income
For tax purposes, the following income tax differences existed:
a. Revenues on the 20X9 statement of profit and loss include $47,000 rent, which is taxable in 20X8 but was unearned at the end of
20X8 for accounting purposes.
b. Expenses on the 20X9 statement of profit and loss include political contributions of $17,500, which are not deductible for income tax
purposes.
c. Expenses on he 20X8 statement of profit and loss include $21,900 estimated warranty costs, which are not deductible for
income tax purposes until 20X9.
Year
20X8
$286, 000
191, 000
$ 95,000
Required:
1. What was the accounting carrying value and tax basis for unearned revenue and the warranty liability at the end of 20X8 and 20X9?
(Leave no cells blank - be certain to enter "0" wherever required.)
Accounting carrying value
Tax basis
20X9
$350,000
247, 000
$103, 000
a. Income tax payable
b. Deferred income tax
c. Total income tax expense
20x8
20X9
Unearned Rent Warranty Unearned Rent
2. Compute (a) income tax payable, (b) deferred income tax, and (c) income tax expense for each period. Assume a tax rate of 30%.
(Amounts to be deducted should be indicated by a minus sign.)
20X8
Warranty
20X9](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5a8374e2-0c11-468f-938f-bf163a68d0f0%2F62b23f4c-0bb1-4c31-98c7-3e46e9af5237%2Fqm0eovj_processed.png&w=3840&q=75)
Transcribed Image Text:Revenues
Expenses
Pre-tax income
For tax purposes, the following income tax differences existed:
a. Revenues on the 20X9 statement of profit and loss include $47,000 rent, which is taxable in 20X8 but was unearned at the end of
20X8 for accounting purposes.
b. Expenses on the 20X9 statement of profit and loss include political contributions of $17,500, which are not deductible for income tax
purposes.
c. Expenses on he 20X8 statement of profit and loss include $21,900 estimated warranty costs, which are not deductible for
income tax purposes until 20X9.
Year
20X8
$286, 000
191, 000
$ 95,000
Required:
1. What was the accounting carrying value and tax basis for unearned revenue and the warranty liability at the end of 20X8 and 20X9?
(Leave no cells blank - be certain to enter "0" wherever required.)
Accounting carrying value
Tax basis
20X9
$350,000
247, 000
$103, 000
a. Income tax payable
b. Deferred income tax
c. Total income tax expense
20x8
20X9
Unearned Rent Warranty Unearned Rent
2. Compute (a) income tax payable, (b) deferred income tax, and (c) income tax expense for each period. Assume a tax rate of 30%.
(Amounts to be deducted should be indicated by a minus sign.)
20X8
Warranty
20X9
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