On January 1, 2021, Ameen Company purchased major pieces of manufacturing equipment for a total of \( \$ 36 \) million. Ameen uses straight-line depreciation for financial statement reporting and deducted 100 % of the equipment's cost for income tax reporting in 2021. At December 31, 2023, the book value of the equipment was \(\S 30 million. At December 31, 2024, the book value of the equipment was \(\S 28 \) million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2024 was \(\$ 50 \) million. Required: 1. Prepare the appropriate journal entry to record Ameen's 2024 income taxes. Assume an income tax rate of \( 25 \ 96 \). 2. What is Ameen's 2024 net income?
On January 1, 2021, Ameen Company purchased major pieces of manufacturing equipment for a total of \( \$ 36 \) million. Ameen uses straight-line depreciation for financial statement reporting and deducted 100 % of the equipment's cost for income tax reporting in 2021. At December 31, 2023, the book value of the equipment was \(\S 30 million. At December 31, 2024, the book value of the equipment was \(\S 28 \) million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2024 was \(\$ 50 \) million. Required: 1. Prepare the appropriate journal entry to record Ameen's 2024 income taxes. Assume an income tax rate of \( 25 \ 96 \). 2. What is Ameen's 2024 net income?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 14P: Hunter Company purchased a light truck on January 2, 2019 for 18,000. The truck, which will be used...
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