Question 21, Warm-Up 1-6 (algorithmic) For 2020, Ross Corporation had pretax ordinary income of $501,000 and sold for $149,000 an asset purchased previously for $129,000. Calculate the tax liability forthe company. The tax liability this year is s (Round to the nearest dollar.)
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- LO.2 Oak Corporation has the following general business credit carryovers. If the general business credit generated by activities during 2019 equals 36,000 and the total credit allowed during the current year is 60,000 (based on tax liability), what amounts of the current general business credit and carryovers are utilized against the 2019 income tax liability? What is the amount of unused credit carried forward to 2020?Quince Corporation has taxable income of $485,000 for its calendar tax year. Calculate the corporation's income tax liability for 2019 before tax credits. $________________Fisafolia Corporation has gross income from operations of $210,000 and operating expenses of $160,000 for 2019. The corporation also has $30,000 in dividends from publicly traded domestic corporations in which the ownership percentage was 45 percent. Calculate the corporation's dividends received deduction for 2019. $_____________ Assume that instead of $210,000, Fisafolia Corporation has gross income from operations of $135,000. Calculate the corporation's dividends received deduction for 2019. $___________ Assume that instead of $210,000, Fisafolia Corporation has gross income from operations of $158,000. Calculate the corporation's dividends received deduction for 2019. $_____________
- QUESTION 28 For 2020, Forway Corporation, an Accrual Basis calendar year corporation, had Net Income Per Books of $111,550 and the following transactions Premiums on Life Insurance Policy on its key employees -$6,000, Excess Capital Losses - $12.000, Excess Tax Depreciation - $9,000, Life Insurance Proceeds on life of its key employees - $65.000: Rent Income received in 2020 - $30,000 (S20,000 is prepaid and relates to 2020): Tax-Exempt Interest Income - $8,000, Federal Income Tax liability for 2020 - $15,450; Prepaid Rent received and properly taxed in 2019 (but not eamed for Financial Accounting purposes until 2020) - $5.000; Interest Expense on Tax-Exempt Interest Income item - $2.000. The total amount "added" to Net Income Per Books for Forrway Corporation in its Schedule M-1 Reconciliation for the tax year of 2020 is OS 80.000 O$ 55,450 OS 07.000 $167.000Question 1 At 30 June 2019, Beta Ltd had the following deferred tax balances: Deferred tax liability $18,000 Deferred tax asset 15,000 Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included the following items: Depreciation expense – plant $7,000 Doubtful debts expense 3,000 Long-service leave expense 4,000 For taxation purposes the following amounts are allowable deductions for the year to 30 June 2020: Tax depreciation – plant $8,000 Bad debts written off 2,000 Depreciation rates for taxation purposes are higher than for accounting purposes. A corporate tax rate of 30% applies. Required: a) Determine the taxable income and income tax payable for the year to 30 June 2020. b) Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. c) Prepare the necessary journal entries to account for income tax…PROBLEM 1 Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return:Taxable income P 4,000,000Non-deductible expenses 200,000Non-taxable revenue 300,000Deferred income on installment saleincluded in financial income but taxable in 2022 450,000Doubtful accounts recorded 100,000Financial depreciation 300,000Tax depreciation 350,000Estimated warranty cost accrued in2021 but not deductible for tax purposes until paid…
- Question 1At 30 June 2019, Beta Ltd had the following deferred tax balances:Deferred tax liability $18,000Deferred tax asset 15,000Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included thefollowing items:Depreciation expense – plant $7,000Doubtful debts expense 3,000Long-service leave expense 4,000For taxation purposes the following amounts are allowable deductions for the year to 30 June 2020:Tax depreciation – plant $8,000Bad debts written off 2,000Depreciation ratesfor taxation purposes are higher than for accounting purposes. A corporate tax rateof 30% applies.Required: answer these all 4 parts of question no 1a) Determine the taxable income and income tax payable for the year to 30 June 2020. b) Determine by what amount the balances of the deferred liability and deferred tax asset willincrease or decrease for the year to 30 June 2020 because of depreciation, doubtful debts andlong-service leave.c) Prepare the necessary journal entries to…Question 1At 30 June 2019, Beta Ltd had the following deferred tax balances:Deferred tax liability $18,000Deferred tax asset 15,000Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included thefollowing items:Depreciation expense – plant $7,000Doubtful debts expense 3,000Long-service leave expense 4,000For taxation purposes the following amounts are allowable deductions for the year to 30 June 2020:Tax depreciation – plant $8,000Bad debts written off 2,000Depreciation ratesfor taxation purposes are higher than for accounting purposes. A corporate tax rateof 30% applies.Required:a) Determine the taxable income and income tax payable for the year to 30 June 2020. b) Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. c) Prepare the necessary journal entries to account for income tax assuming…QUESTION 23 For 2021, Forrway Corporation, an Accrual Basis calendar year corporation, had Net income Per Books of $111.550 and the following transactions Premiums on Life Insurance Policy on its key employees - $6.000: Excess Capital Losses $12,000; Excess Tax Depreciation - $9.000; Life insurance Proceeds on ife of its key employees - $s65,000: Rent Income received in 2021 - $30,000: ($20,000 is prepaid and relates to 2021x Tax-Exempt interest Income - $8,000: Federal income Tax Nability for 2021- $15,450; Prepaid Rent received and properly taxed in 2020 (but not earned for Financial Accounting purposes until 2021)-55,000: Interest Expense on Tax-Exempt Interest Income item - $2.000. The total amount " added" to Net Income Per Books for Forrway Corporation in its Schedule M-1 Reconciliation for the tax year of 2021 is: O$ 80,000. O $167,000. $ 55,450. $ 87,000.
- Assume that the Kelso Company operates in an industry for which NOL carryback is allowed. The Kelso Company had the following operating results: O $22,800. Year 2019 2020 2021 25% What is the income tax refund receivable? O $24,300 O $28,800. Income (loss) 54,000 57,000 (72,000) O 23,550. Tax rate 35% 30% Income tax 18,900first year of operations 17,100 0Question 1 At 30 June 2019, Beta Ltd had the following deferred tax balances: Deferred tax lability Deferred tax asset $18,000 15,000 Beta Ltd recorded a profit before tax of s80,000 for the year to 30 June 2020, which included the following items: Depreciation expense - plant $7,000 Doubtful debts expense Long-service leave expense 3,000 4,000 For taxation purposes the following amounts are allowable deductions for the year to 30 June 2020: Tax depreciation - plant Bad debts written off $8,000 2,000 Depreciation rates for taxation purposes are higher than for accounting purposes. A corporate tax rate of 30% applies. Required: a) Determine the taxable income and income tax payable for the year to 30 June 2020. b) Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. c) Prepare the necessary journal entries to account for income tax…ABC Corporation provides you with the following information for the 2020 tax year, which was the company’s first year of operation:Book Income Before Taxes $100,000,000Book Depreciation $ 5,000,000MACRS Depreciation $ 7,500,000Foreign Sourced Income $ 40,000,000Assume a federal tax rate of 21%, disregard state taxes.a. Calculate federal taxable income.b. Calculate the federal tax payable and federal tax expense.c. Given your answer above in b., is a deferred tax asset or a deferred tax liability created? Provide the journal entry needed to reflect this.