Income Tax Fundamentals 2020
38th Edition
ISBN: 9780357391129
Author: WHITTENBURG
Publisher: Cengage
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Chapter 7, Problem 16P
To determine
Introduction:The Affordable Care Act (ACA) makes health insurance available to more people. ACA has different provisions that affect the income tax liability of a taxpayer. Under this taxpayers receive a tax credit that lowers the cost of health care.
The excess advance premium tax credit for C’s for 2019.
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Which one of the following amounts represents the maximum amount that you may deduct for
moving expenses on your 2020 personal income tax return?
A) $ 8,800.
B) $ 9,700.
C) $10,200.
D) $11,250.
Allmond Corporation, organized on January 3, 2021, had pretax accounting income of $30 million and taxable income
of $38 million for the year ended December 31, 2021. The 2021 tax rate is 25%. The only difference between
accounting income and taxable income is estimated product warranty costs. Assume that expected payments and
scheduled tax rates (based on recently enacted tax legislation) are as follows:
2022 $million
25%
2023
25%
million
2
2024
25%
million
2025
20%
million
Required:
1. Determine the amounts necessary to record Allmond's income taxes for 2021 and prepare the appropriate journal
entry.
2. What is Allmond's 2021 net income?
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1
2
Determine the amounts necessary to record Allmond's income taxes for 2021. (Enter your
answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).
Enter all amounts as positive values.)
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Chapter 7 Solutions
Income Tax Fundamentals 2020
Ch. 7 - Russ and Linda are married and file a joint tax...Ch. 7 - Jennifer is divorced and files a head of household...Ch. 7 - Prob. 3MCQCh. 7 - Prob. 4MCQCh. 7 - Which of the following is not a requirement to...Ch. 7 - For purposes of determining income eligibility for...Ch. 7 - Prob. 7MCQCh. 7 - Prob. 8MCQCh. 7 - Which of the following costs is not a qualified...Ch. 7 - Prob. 10MCQ
Ch. 7 - Prob. 11MCQCh. 7 - Prob. 12MCQCh. 7 - Joan, a single mother, has AGI of $61,500 in 2019....Ch. 7 - Prob. 14MCQCh. 7 - Prob. 15MCQCh. 7 - Prob. 16MCQCh. 7 - Prob. 17MCQCh. 7 - Prob. 18MCQCh. 7 - Prob. 19MCQCh. 7 - Prob. 20MCQCh. 7 - Virginia and Richard are married taxpayers with...Ch. 7 - Calculate the total child and other dependent...Ch. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Prob. 4PCh. 7 - Prob. 5PCh. 7 - Prob. 6PCh. 7 - Prob. 8PCh. 7 - Prob. 9PCh. 7 - Clarita is a single taxpayer with two dependent...Ch. 7 - Prob. 12PCh. 7 - Prob. 13PCh. 7 - Marty and Jean are married and have 4 -year-old...Ch. 7 - Prob. 15PCh. 7 - Prob. 16PCh. 7 - Prob. 17PCh. 7 - Prob. 18PCh. 7 - Janie graduates from high school in 2019 and...Ch. 7 - Prob. 20PCh. 7 - Prob. 21PCh. 7 - Carl and Jenny adopt a Korean orphan. The adoption...Ch. 7 - Prob. 23PCh. 7 - Prob. 24PCh. 7 - Prob. 25P
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- Determine from the tax table in Appendix A the amount of the income tax for each of the following taxpayers for 2019:arrow_forwardYour adjusted gross income (line 11 of the form 1040) is $150,000. Your filing status is Single. Your standard deduction (Line 12) is $12,400. Using the 2020 Income Tax Rate Schedule, please calculate the amount of income taxes you will owe for the year. A. $12,864.00 B. $27,104.50 C. $36,000.00 OD. $30,174.50arrow_forwardThe tax rates in effect are 2019, 40%; 2020 and 2021, 45%. All tax rates were enacted into law on January 1, 2019. No deferred income taxes existed at the beginning of 2019. Taxable income is expected in all future years. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019, 2020, and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Dec. 31.2019 Dec. 31, 2020 Account Titles and Explanation Debit Creditarrow_forward
- Based on the following data, will Ann Wilton receive a federal tax refund or owe additional taxes in 2019? ( Input the amount as a positive value. Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.) Taxable Income Tax Rate 0-$47,630 15% $47,630-$ 95,259 20.5% $95, 259-$147,667 26% $147, 667-$ 210,371 29% Net income(line 23600) $ 51,790 Deductions to determine net income $ 11,660 Federal income tax withheld $ 7,144 Total non-refundable tax credit amounts, excluding medical expenses $ 12, 189 Medical expenses $ 3,100arrow_forwardUse (a) the percentage method and (b) the wage-bracket method to compute the federal income taxes to withhold from the wages or salaries of each employee. Enter all amounts as positive numbers. Round your calculations and final answers to the nearest cent. Use the 2020 Federal income taxes tables for the percentage method table and the wage bracket method tablearrow_forwardPlease help me to solve this problemarrow_forward
- Then, calculate the Taxable Income for 2021. (Round your answers to the nearest dollar.) Employment income ABIL Taxable capital gain Allowable capital loss (disallowed ABIL) Net taxable capital gains 2021 Net income Capital gains deduction 2016 Net capital loss deducted 2021 Taxable incomearrow_forwardConsider the following accounts and determine if the account is a current liability, a noncurrent liability, or neither. A. cash B. federal income tax payable this year C. long-term note payable D. current portion of a long-term note payable E. note payable due in four years F. interest expense G. state income taxarrow_forwardHow do the all events and economic performance requirements apply to the following transactions by an accrual basis taxpayer? a. The company guarantees its products for six months. At the end of 2019, customers had made valid claims for 600,000 that were not paid until 2020. Also, the company estimates that another 400,000 in claims from 2019 sales will be filed and paid in 2020. b. The accrual basis taxpayer reported 200,000 in corporate taxable income for 2019. The state income tax rate was 6%. The corporation paid 7,000 in estimated state income taxes in 2019 and paid 2,000 on 2018 state income taxes when it filed its 2018 state income tax return in March 2019. The company filed its 2019 state income tax return in March 2020 and paid the remaining 5,000 of its 2019 state income tax liability. c. An employee was involved in an accident while making a sales call. The company paid the injured victim 15,000 in 2019 and agreed to pay the victim 15,000 a year for the next nine years.arrow_forward
- LO.2, 3, 4, 5, 6, 7 For calendar year 2019, Stuart and Pamela Gibson file a joint return reflecting AGI of 350,000. Their itemized deductions are as follows: Calculate the amount of itemized deductions the Gibsons may claim for the year.arrow_forwardBased on the following data, will Ann Wilton receive a federal tax refund or owe additional taxes in 2019? (Input the amount as a positive value. Round your intermediate calculations and final answer to 2 decimal places. Omit the "$" sign in your response.) Taxable Income 0-$47,630 $47,630-$95,259 $95,259-$147,667 $147,667-$210,371 Tax Rate 158 20.58 268 298 Net income (line 23600) Deductions to determine net income Federal income tax withheld Total non-refundable tax credit amounts, excluding medical expenses Medical expenses Refund $8149.85$ $50,690 $11,570 $ 7,009 $12,144 $ 2,800arrow_forwardGiven that your gross income for 2020 was $180,000 and your taxable income was $140,000. Calculate: a. the marginal tax rate b. the average tax rate c. the effective tax rate. SHOW WORKarrow_forward
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