SWFT Comprehensive Volume 2019
42nd Edition
ISBN: 9780357233306
Author: Maloney
Publisher: Cengage
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Financial Accounting
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Purple Corp. reported under GAAP for the year ended 12/31/2024 depreciation expense $45,000 and warranty
expense $25,000. During 2024, $5,000 in warranties were serviced, and the remainder is estimated to be serviced over
the following 4 years. Under the tax code, depreciation for 2024 would be $60,000. Assuming these are the only
differences between GAAP and the tax code, how much would be reported as a deferred tax expense or deferred tax
benefit on the income statement for the year ended 12/31/2024 if the future tax rate will be 30%?
A A deferred tax expense of $4,500
B
A deferred tax benefit of $6,000
C
A deferred tax expense of $1,500
D
A deferred tax benefit of $1,500
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- Nonearrow_forwardNeed helparrow_forward11) Amber Inc has 200,000 shares of $10-par common stock outstanding and 4,000 shares of $50-par 8% convertible preferred stock outstanding. For 2024, Amber reported net income of $700,000 after deducting income taxes at a 30% rate. If each share of preferred stock is convertible into 1 share of common stock, what would Amer report for diluted earnings per share? A $3.42 B $3.43 C D $3.35 $0.00 12) Yellow Co foresees the possibility of being unsuccessful in a lawsuit that may result in incurring a major loss associated with its related liability. Which of the following is correct? A If it is remote, and a guarantee was given, a disclosure is necessary, but not an accrual. B If it is probable, a disclosure is necessary, but not an accrual. с If it is probable, an accrual is necessary but not a disclosure. D If it is reasonably possible, neither accrual nor disclosure is necessary. 13) On Jan 1, Year 1, White Co grants its three top employees, Mr. Blue, Ms. Orange, and Mrs. Green, 3,000…arrow_forward
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