Sunland Company has the following two temporary differences between its income tax expense and income taxes payable. 2020 2021 2022 Pretax financial income $842,000 $956,000 $914,000 Excess depreciation expense on tax return (28,800 ) (39,300 ) (9,900 ) Excess warranty expense in financial income 20,400 9,500 7,600 Taxable income $833,600 $926,200 $911,700 The income tax rate for all years is 20%. (b) Indicate how deferred taxes will be reported on the 2022 balance sheet. Sunland’s product warranty is for 12 months. Sunland Company Balance Sheet (Partial) $ Save for Later Attempts: 0 of 1 used Submit Answer
Sunland Company has the following two temporary differences between its income tax expense and income taxes payable. 2020 2021 2022 Pretax financial income $842,000 $956,000 $914,000 Excess depreciation expense on tax return (28,800 ) (39,300 ) (9,900 ) Excess warranty expense in financial income 20,400 9,500 7,600 Taxable income $833,600 $926,200 $911,700 The income tax rate for all years is 20%. (b) Indicate how deferred taxes will be reported on the 2022 balance sheet. Sunland’s product warranty is for 12 months. Sunland Company Balance Sheet (Partial) $ Save for Later Attempts: 0 of 1 used Submit Answer
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Sunland Company has the following two temporary differences between its income tax expense and income taxes payable.
|
2020
|
2021
|
2022
|
|||||||
| Pretax financial income |
$842,000
|
$956,000
|
$914,000
|
||||||
| Excess |
(28,800
|
)
|
(39,300
|
)
|
(9,900
|
)
|
|||
| Excess warranty expense in financial income |
20,400
|
9,500
|
7,600
|
||||||
| Taxable income |
$833,600
|
$926,200
|
$911,700
|
The income tax rate for all years is 20%.
(b)
Indicate how deferred taxes will be reported on the 2022 balance sheet . Sunland’s product warranty is for 12 months.
|
Sunland Company
Balance Sheet (Partial) |
||||||
|
|
||||||
|
|
$
|
Save for Later
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(c)
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Step 1
Balance Sheet-
A balance sheet refers to the statement that displays all the obligations owed by a firm, the asset of the owners, and also the wealth owned by a firm or a corporation. It indicates the financial worth of an organization or a firm at the end of the particular financial year.
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