Financial Accounting
3rd Edition
ISBN: 9780133791129
Author: Jane L. Reimers
Publisher: Pearson Higher Ed
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Chapter 10, Problem 3MCQ
To determine
Identify the manner of reporting the gains from fixed assets on the financial statement.
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Whipporwill, Incorporated's, net income for the most recent year was $9,551. The tax rate was 23 percent. The
firm paid $4,695 in total interest expense and deducted $5,162 in depreciation expense.
a. What was the company's taxable income for the year?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
b. What was the company's EBIT for the year?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
c. What was the company's cash coverage ratio for the year?
Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
DER Company has the following in the current year:
Capital gains of $8,500
Capital losses of $18,500
Business income of S7,500
Property income of $5,500
Which of the following will be included in Net Income for Tax Purposes for DER Company?
.....
Choose the correct answer.
O A. capital losses of $4,250
O B. capital gains of $10,000
OC. capital losses of $8,500
O D. capital losses of $0
21)
Santos Company had a 40 percent tax rate. Given the following pre-tax
amounts, what would be the income tax expense reported on the face of the income
statement?
$ 300,000
180,000
24,000
33,000
27,000
3,000
6,000
Sales revenue
Cost of goods sold
Salaries and wages expense
Depreciation expense
Dividend revenue
Utilities expense
Interest expense
22)
York Corporation reports the following information:
Correction of understatement of depreciation expense
in prior years, net of tax
$ 645,000
480,000
1,500,000
3,000,000
Dividends declared
Net income
Retained earnings, 1/1/21, as reported
York should report retained earnings, 12/31/21, as adjusted at?
23)
Jersey Company reported the following information for 2021:
Sales revenue
1,530,000
1,050,000
165,000
Cost of goods sold
Operating expenses
Unrealized holding gain on
available-for-sale securities
Cash dividends received on the securities
120,000
6,000
For 2021, Jersey would report other comprehensive income of?
24)
For the year ended…
Chapter 10 Solutions
Financial Accounting
Ch. 10 - Prob. 1YTCh. 10 - Prob. 2YTCh. 10 - Prob. 3YTCh. 10 - Prob. 4YTCh. 10 - Prob. 5YTCh. 10 - Define the items that the Financial Accounting...Ch. 10 - Prob. 2QCh. 10 - Prob. 3QCh. 10 - Prob. 4QCh. 10 - Prob. 5Q
Ch. 10 - Prob. 6QCh. 10 - What is solvency? Which ratios are useful for...Ch. 10 - What is profitability? Which ratios are useful for...Ch. 10 - What are market indicators? Which ratios are...Ch. 10 - Prob. 10QCh. 10 - Prob. 1MCQCh. 10 - Current assets for Kearney Company are 120,000 and...Ch. 10 - Prob. 3MCQCh. 10 - Prob. 4MCQCh. 10 - Prob. 5MCQCh. 10 - Prob. 6MCQCh. 10 - Prob. 7MCQCh. 10 - Prob. 8MCQCh. 10 - Prob. 9MCQCh. 10 - Prob. 10MCQCh. 10 - Prob. 1SEACh. 10 - Prob. 2SEACh. 10 - Prob. 3SEACh. 10 - Prob. 4SEACh. 10 - Prob. 5SEACh. 10 - A five-year comparative analysis of Low Light...Ch. 10 - Prob. 7SEACh. 10 - Prob. 8SEBCh. 10 - Prob. 9SEBCh. 10 - Prob. 10SEBCh. 10 - Perform a vertical analysis on the following...Ch. 10 - Prob. 12SEBCh. 10 - Prob. 13SEBCh. 10 - Use the following information to construct a...Ch. 10 - Prob. 16EACh. 10 - Prob. 17EACh. 10 - Prob. 18EACh. 10 - Prob. 19EACh. 10 - Use the balance sheets from Suzannes Hotels in...Ch. 10 - Prob. 21EACh. 10 - Prob. 22EACh. 10 - Prob. 23EACh. 10 - Use the statements of earnings for Campbell Soup...Ch. 10 - Prob. 25EACh. 10 - Prob. 26EACh. 10 - Prob. 27EACh. 10 - Prob. 28EBCh. 10 - Prob. 29EBCh. 10 - Prob. 30EBCh. 10 - Prob. 31EBCh. 10 - Prob. 32EBCh. 10 - Prob. 33EBCh. 10 - Prob. 34EBCh. 10 - Prob. 35EBCh. 10 - Prob. 36EBCh. 10 - Prob. 37EBCh. 10 - Prob. 38EBCh. 10 - Prob. 39EBCh. 10 - Prob. 40EBCh. 10 - Prob. 41PACh. 10 - Prob. 42PACh. 10 - Prob. 43PACh. 10 - Following are the income statements for Alpha...Ch. 10 - Prob. 45PACh. 10 - Prob. 46PACh. 10 - Prob. 47PACh. 10 - You are interested in investing in Teddy Company,...Ch. 10 - Prob. 49PBCh. 10 - Prob. 50PBCh. 10 - Prob. 51PBCh. 10 - Prob. 52PBCh. 10 - Prob. 53PBCh. 10 - Prob. 54PBCh. 10 - Prob. 55PBCh. 10 - Prob. 56PBCh. 10 - Prob. 1CTPCh. 10 - Prob. 2CTP
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- Talbot Enterprises recently reported an EBITDA of $8 million and net income of $2.4 million. It had $2.0 million of interest expense, and its corporate tax rate was 40%. What was its charge for depreciation and amortization?arrow_forwardJuroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Refer to the information for Juroe Company on the previous page. Also, assume that Juroes total assets at the beginning of last year equaled 17,350,000 and that the tax rate applicable to Juroe is 40%. Required: Note: Round answers to two decimal places. 1. Calculate the average total assets. 2. Calculate the return on assets.arrow_forwardThe following information relates to Sustagoon Ltd. Profit before tax for the year ended 30 June 2020 was $504,400. The following items were used in determining that profit: Sales revenue 1,450,800 Cost of sales 608,400 Selling expenses 156,000 Administrative expenses 93,600 Other expenses 57,200 Interest expense 31,200 504,400 Other events which occurred during the year: Gain on revaluation of land 26,000 Assume the company’s taxation rate is 30c in the dollar. Required: Prepare a statement of profit or loss and other comprehensive income for the year ended 30 June 2020, in accordance with the requirements of AASB 101. Based on the information received determine whether to disclose by function or nature. Ignore comparatives as the information is not provided.arrow_forward
- The Pearson corporation reported an EBITDA of $7.5 million, net income of $1.8 million, $2 million of interest expense. The applicable corporate tax rate was 40%. Calculate the firm’s depreciation and amortization expense.arrow_forwardXYZ Co has disclosed the following financial information for the period ending 12/31/19: sales of $1,522,982, cost of goods sold of $825,220, depreciation expenses of $101,083, and interest expenses of $80,341. Assume that the firm has an average tax rate of 35 percent. What is the company's net income?( Please round your answer for the Tax and Net income line to the whole number, for example 5. ) Sales COGS ( ? ) Deprecation ( ? ) Interest exp ( ? ) Pre-Tax Income ? Tax ( ? ) Net Income ?arrow_forwardSoutheast Airlines had pretax earnings of $65 million. Included in this amount is income from discontinued operations of $10 million. The company's tax rate is 25%. What is the amount of income tax expense that South-east would report in its income statement for continuing operations? How should the gain on disposal of a dis-continued operation be reported?arrow_forward
- Toodles Inc. had sales of $1,840,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $1,180,000, $185,000 and $365,000 respectively. In addition, the company had an interest expense of $280,000 and a tax rate of 35 percent. (Ignore any tax loss carryback or carry forward provisions.) What was Toodles’s OCF?arrow_forwardFor the past year, Momsen Limited had sales of $47362, interest expense of $4166, cost of goods sold of $17,359, selling and administrative expense of $12,146, and depreciation of $6,995. If the tax rate was 21 percent, what was the company's net income? Multiple Choice O $5,132 $6,496 $11,550 $4,547 $2.444arrow_forwardPecorino Company had pretax financial income of P2,500,000 in the current year. The entity made corporate estimated tax payment in the amount of 180,000 during the current year. To compute the provision for income tax, the following information was provided: Interest income received 360,000 Tax depreciation in excess of financial statement amount 160,000 Rent received in advance 280,000 Corporate tax rate 30% What amount of permanent difference between book income and taxable income existed at year-end?arrow_forward
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