View Policies Current Attempt in Progress The accounting records of Windsor Inc. show the following data for 2025 (its first year of operations). 1. Life insurance expense on officers was $8,300. 2. Equipment was acquired in early January for $323,000. Straight-line depreciation over a 5-year life is used, with no salvage value. For tax purposes, Windsor used a 30% rate to calculate depreciation. 3. Interest revenue on State of New York bonds totaled $4,000. 4. Product warranties were estimated to be $54,000 in 2025. Actual repair and labor costs related to the warranties in 2025 were $9,200. The remainder is estimated to be paid evenly in 2026 and 2027. 5. Gross profit on an accrual basis was $98,000. For tax purposes, $68,300 was recorded on the installment-sales method. 6. Fines incurred for pollution violations were $4,200. 7. Pretax financial income was $739,600. The tax rate is 30%. (a) Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025. Schedule of Pretax Financial Income and Taxable Income for 2025 Pretax financial income $ Permanent differences Temporary differences $ (a) Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025. Schedule of Pretax Financial Income and Taxable Income for 2025 Pretax financial income Permanent differences $ Temporary differences Warranty Expense $ Pollution Fines Insurance Expense Depreciation Expense Bond Interest Revenue Installment Sales Interest Expense Repair and Labor Costs Attempts: 0 of 3 used Submit Answer
View Policies Current Attempt in Progress The accounting records of Windsor Inc. show the following data for 2025 (its first year of operations). 1. Life insurance expense on officers was $8,300. 2. Equipment was acquired in early January for $323,000. Straight-line depreciation over a 5-year life is used, with no salvage value. For tax purposes, Windsor used a 30% rate to calculate depreciation. 3. Interest revenue on State of New York bonds totaled $4,000. 4. Product warranties were estimated to be $54,000 in 2025. Actual repair and labor costs related to the warranties in 2025 were $9,200. The remainder is estimated to be paid evenly in 2026 and 2027. 5. Gross profit on an accrual basis was $98,000. For tax purposes, $68,300 was recorded on the installment-sales method. 6. Fines incurred for pollution violations were $4,200. 7. Pretax financial income was $739,600. The tax rate is 30%. (a) Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025. Schedule of Pretax Financial Income and Taxable Income for 2025 Pretax financial income $ Permanent differences Temporary differences $ (a) Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025. Schedule of Pretax Financial Income and Taxable Income for 2025 Pretax financial income Permanent differences $ Temporary differences Warranty Expense $ Pollution Fines Insurance Expense Depreciation Expense Bond Interest Revenue Installment Sales Interest Expense Repair and Labor Costs Attempts: 0 of 3 used Submit Answer
Chapter18: Accounting Periods And Methods
Section: Chapter Questions
Problem 49P
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Transcribed Image Text:View Policies
Current Attempt in Progress
The accounting records of Windsor Inc. show the following data for 2025 (its first year of operations).
1.
Life insurance expense on officers was $8,300.
2.
Equipment was acquired in early January for $323,000. Straight-line depreciation over a 5-year life is used, with no salvage
value. For tax purposes, Windsor used a 30% rate to calculate depreciation.
3.
Interest revenue on State of New York bonds totaled $4,000.
4.
Product warranties were estimated to be $54,000 in 2025. Actual repair and labor costs related to the warranties in 2025
were $9,200. The remainder is estimated to be paid evenly in 2026 and 2027.
5.
Gross profit on an accrual basis was $98,000. For tax purposes, $68,300 was recorded on the installment-sales method.
6.
Fines incurred for pollution violations were $4,200.
7.
Pretax financial income was $739,600. The tax rate is 30%.
(a)
Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025.
Schedule of Pretax Financial Income
and Taxable Income for 2025
Pretax financial income
$
Permanent differences
Temporary differences
$
Transcribed Image Text:(a)
Prepare a schedule starting with pretax financial income in 2025 and ending with taxable income in 2025.
Schedule of Pretax Financial Income
and Taxable Income for 2025
Pretax financial income
Permanent differences
$
Temporary differences
Warranty Expense
$
Pollution Fines
Insurance Expense
Depreciation Expense
Bond Interest Revenue
Installment Sales
Interest Expense
Repair and Labor Costs
Attempts: 0 of 3 used Submit Answer
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