Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

Question

Want to see the full answer?

Answer 1

Question

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

The December 31, 2021, balance sheet of Chen, Incorporated, showed long-term debt of $1,420,000, $144,000 in the common stock account, and $2,690,000 in the additional paid-in surplus account. The December 31, 2022, balance sheet showed long-term debt of $1,620,000, $154,000 in the common stock account and $2,990,000 in the additional paid-in surplus account. The 2022 income statement showed an interest expense of $96,000 and the company paid out $149,000 in cash dividends during 2022. The firm’s net capital spending for 2022 was $1,000,000, and the firm reduced its net working capital investment by $129,000. What was the firm's 2022 operating cash flow, or OCF?

River is a salaried exempt worker who earns $73,630 per year for a 35-hour workweek. During a biweekly pay period, River worked 105 hours. What is the gross pay?

The industrial enterprise "HUANG S.A." purchased a sorting and packaging machine from a foreign company on 1/4/2017 at a cost of €500,000. The useful life of the machine was estimated by the Management at ten (10) years, while the residual value was estimated at zero. For the transportation of the machine from abroad to the company's factory, the amount of €20,000 was paid on 15/4/2017. As the insurance coverage of the machine during transportation was the responsibility of the selling company, HUANG S.A. proceeded to insure the machine from 16/4/2017 to 15/4/2018, paying the amount of €1,200. The delivery took place on 15/4/2017. As adequate ventilation of the multifunction device is essential for its proper operation, the company fitted an air duct on the multifunction device. The cost of the air duct amounted to €2,000 and was paid on 20/4/2017. On 25/4/2017, an external electrician was paid €5,000 for the electrical connection of the device. The company also paid €5,000 to an…

Answer 2

Question

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Answer 6

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

Answer 7

Chapter 9, Problem 5E

a)

To determine

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

Answer 8

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

Answer 9

b)

To determine

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

Answer 10

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Answer 11

c)

To determine

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 9 - Prob. 1STQ Ch. 9 - 2. Which of the following statements is (are)...Ch. 9 - 3. On April 1 of the preceding (first) year,...Ch. 9 - 4. Evergreen Mfg. is a rapidly growing company...Ch. 9 - 5. Ladd Company sold a plant asset that originally...Ch. 9 - Prob. 6STQ Ch. 9 - 1. Coca-Cola’s distinctive trademark is more...Ch. 9 - 2. Identify the basic “accountable events” in the...Ch. 9 - Prob. 3DQ Ch. 9 - 4. What is the distinction between a capital...

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

Concept explainers

Videos

Identify whether the company violating the consistency principle of accounting by using different depreciation methods in its financial statements than in its income tax returns and explain the same.

Explain the reasons that the Company L uses accelerated depreciation methods in its income tax returns.

Explain whether the use of accelerated depreciation method in the financial statements be more conservative or less conservative than the current practice of straight line method.

Want to see the full answer?

Chapter 9 Solutions