a.
effective tax rate of company W and difference between effective tax rate and statutory tax rate.
Given Information:
Effective tax rate for year 2013 is 32.9%.
Effective tax rate for 2012 is 31%.
Effective tax rate for 2011 is 32.6%.
Statutory tax rate is 35%.
b.
To compare: Effective tax rate of company T.
Given Information:
Effective tax rate of company T for year 2011 is 34.30%.
For year 2012 is 34.90%.
For year 2013 is 36.50%.
c.
Conservatism ratio for each year.
Given Information:
Income before tax for 2011 is $24,332.
For year 2012 is $25,662.
For year 2013 is $24,656.
d.
implications for computing the conservatism ratio.
Given Information:
Income from discontinued operation in fiscal year 2012 is $52 million.
Income from discontinued operation in fiscal year 2013 is $144 million.
e.
To Compare: Conservatism ratio of company T and company W.
Given Information:
Conservatism ratio of company T for year 2011 is 1.32.
For year 2012 is 0.99.
For year 2013 is 0.82.
Want to see the full answer?
Check out a sample textbook solutionChapter 17 Solutions
Intermediate Accounting - Myaccountinglab - Pearson Etext Access Card Student Value Edition
- Subject:- General Account Data for a firm's first year of operation is given below. The firm uses direct costing: Units produced (no work in process) 6,000 Units sold 5,000 units in ending inventory of finished goods 1,000 Sales price for each unit $75 Variable manufacturing costs for each unit manufactured $30 Variable selling and admin. expenses for each unit sold $16 Fixed manufacturing costs for the year $90,000 Fixed selling and admin. expenses for the year $65,000 The costs of the goods sold for the year is: a) $270,000 b) $225,000 c) $150,000 d) $45,000arrow_forwardQuestion: Cost Account Many companies have switched from absorption costing to variable costing for internal reporting: A) so the denominator level is more accurate B) to reduce the undesirable incentive to build up inventories C) to comply with external reporting requirements D) to increase bonuses for managersarrow_forwardSubject = General Accountarrow_forward
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education