Cengagenowv2, 1 Term Printed Access Card For Wahlen/jones/pagach’s Intermediate Accounting: Reporting And Analysis, 2017 Update, 2nd
2nd Edition
ISBN: 9781337912259
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Chapter 18, Problem 7E
1.
To determine
Prepare
2.
To determine
Prepare journal entry to record the tax expense, tax payable and deferred tax for the year.
3.
To determine
Elaborate the circumstances that necessitate the utilization of valuation allowance account when deferred tax is recognized and show the manner for reporting the account in financial statements.
4.
To determine
Comment on the answer provided by requirement 2, assuming that Company Z prepares financial statements using IFRS.
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In 2017, Kerry Corp's financial statement showed accrued losses on disposal of unused plant facilities of $3,600,000. The facilities were sold in December 2018 and a $3,600,000 loss was recognized for tax purposes then. Also in 2018, Kerry Corp's paid $150,000 for a two-year life insurance policy for their CEO Kerry, and the company was the beneficiary. Assuming that the enacted tax rate is 35% in both 2017 and 2018. Show the steps for the amount reported on December 31, 2017 as net deferred income taxes on the balance sheet
ABC corp began operations in 2014. The table below contains the company’s taxable income during each year of its operations. Notice that the company lost money in each of its first three years. The corporate tax rate has been 40% each year.
Year Taxable Income
2014 -$700,000
2015 -$500,000
2016 -$300,000
2017 $800,000
2018 $1,000,000
Assume that the company has taken full advantage of the Tax Code’s carry-back, carry-forward provisions, and assume that the current provisions were applicable in 2014. How much did the company pay in taxes during 2018?
$160,000
$176,400
$194,481
$185,220
$120,000
This company began operations in 2014. The table below contains the company’s taxable income during each year of its operations. Notice that the company lost money in each of its first three years. The corporate tax rate has been 40% each year.
Year Taxable Income
2014 -$700,000
2015 -$500,000
2016 -$200,000
2017 $800,000
2018 $1,000,000
Assume that the company has taken full advantage of the Tax Code’s carry-back, carry-forward provisions, and assume that the current provisions were applicable in 2014. How much did the company pay in taxes during 2018?
$185,220
$194,481
$176,400
$160,000
$168,000
Chapter 18 Solutions
Cengagenowv2, 1 Term Printed Access Card For Wahlen/jones/pagach’s Intermediate Accounting: Reporting And Analysis, 2017 Update, 2nd
Ch. 18 - What source is used to determine income tax...Ch. 18 - Prob. 2GICh. 18 - Prob. 3GICh. 18 - Prob. 4GICh. 18 - Prob. 5GICh. 18 - Prob. 6GICh. 18 - What are the three characteristics of a liability,...Ch. 18 - Prob. 8GICh. 18 - When does a corporation establish a valuation...Ch. 18 - List the steps necessary to measure and record a...
Ch. 18 - Prob. 11GICh. 18 - Prob. 12GICh. 18 - Prob. 13GICh. 18 - Prob. 14GICh. 18 - Prob. 15GICh. 18 - Describe an operating loss carryforward. List the...Ch. 18 - Prob. 17GICh. 18 - Prob. 18GICh. 18 - Prob. 19GICh. 18 - Prob. 20GICh. 18 - Prob. 21GICh. 18 - Prob. 22GICh. 18 - Prob. 23GICh. 18 - Prob. 24GICh. 18 - Which of the following is not a cause of a...Ch. 18 - Which of the following is an argument in favor of...Ch. 18 - Prob. 3MCCh. 18 - Prob. 4MCCh. 18 - Prob. 5MCCh. 18 - Prob. 6MCCh. 18 - Prob. 7MCCh. 18 - Prob. 8MCCh. 18 - Prob. 9MCCh. 18 - Which component of current income is not disclosed...Ch. 18 - Parker Company identifies depreciation as the only...Ch. 18 - Refer to RE18-1. Assume that Parkers taxable...Ch. 18 - In the current year, Madison Corporation had...Ch. 18 - Refer to RE18-3. Prepare the additional journal...Ch. 18 - Turnip Company purchased an asset at a cost of...Ch. 18 - Prob. 6RECh. 18 - Compute Radish Companys taxable income given the...Ch. 18 - Prob. 8RECh. 18 - Prob. 9RECh. 18 - Kline Company has the following items of pretax...Ch. 18 - Prob. 11RECh. 18 - Cole Company had a deferred tax liability of 1,000...Ch. 18 - Prob. 1ECh. 18 - Prob. 2ECh. 18 - Prob. 3ECh. 18 - Prob. 4ECh. 18 - Prob. 5ECh. 18 - Prob. 6ECh. 18 - Prob. 7ECh. 18 - Prob. 8ECh. 18 - Prob. 9ECh. 18 - Prob. 10ECh. 18 - Prob. 11ECh. 18 - Temporary and Permanent Differences Lin has just...Ch. 18 - Prob. 13ECh. 18 - Prob. 14ECh. 18 - Prob. 15ECh. 18 - Prob. 16ECh. 18 - Prob. 17ECh. 18 - Prob. 18ECh. 18 - Prob. 19ECh. 18 - Prob. 20ECh. 18 - Uncertain Tax Position At the end of the current...Ch. 18 - Prob. 1PCh. 18 - Temporary and Permanent Differences In the current...Ch. 18 - Prob. 3PCh. 18 - Prob. 4PCh. 18 - Prob. 5PCh. 18 - Prob. 6PCh. 18 - Prob. 7PCh. 18 - Prob. 8PCh. 18 - Prob. 9PCh. 18 - Prob. 10PCh. 18 - Prob. 11PCh. 18 - Prob. 12PCh. 18 - Prob. 13PCh. 18 - Comprehensive At the beginning of 2016, Norris...Ch. 18 - Prob. 15PCh. 18 - Prob. 1CCh. 18 - Prob. 2CCh. 18 - Operating Losses The Internal Revenue Code allows...Ch. 18 - Interperiod and Intraperiod Tax Allocation Income...Ch. 18 - Prob. 5CCh. 18 - Prob. 6CCh. 18 - Permanent and Temporary Differences To implement...Ch. 18 - Prob. 8CCh. 18 - Prob. 9CCh. 18 - Prob. 10C
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