3. Bake Company reported the following information on December 31, 2020: Accounts Payable 800,000 Bonds Payable, due 2021 Discount on Bonds Payable Deferred Tax Liability 500,000 Dividend Payable, due on February 15, 2022 1,000,000 Income Tax Payable 800,000 Note Payable due January 15, 2022 1,200,000 The deferred tax liability is based on temporary differences stemming from different depreciation method for financial reporting purposes. What total amount should be reported as current liabilities on December 31, 2020? a. 6,400,000 b. 7,200,000 4,000,000 400,000 c. 7,400,000 d. 7,600,000

3. Bake Company reported the following information on December 31, 2020: Accounts Payable 800,000 Bonds Payable, due 2021 Discount on Bonds Payable Deferred Tax Liability 500,000 Dividend Payable, due on February 15, 2022 1,000,000 Income Tax Payable 800,000 Note Payable due January 15, 2022 1,200,000 The deferred tax liability is based on temporary differences stemming from different depreciation method for financial reporting purposes. What total amount should be reported as current liabilities on December 31, 2020? a. 6,400,000 b. 7,200,000 4,000,000 400,000 c. 7,400,000 d. 7,600,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In 2025 Vaughn Corporation had pretax financial income of $185,000 and taxable income of $117,000. The difference is due to the use of different depreciation methods for tax and accounting purposes. The effective tax rate is 30%. Compute the amount to be reported as income taxes payable at December 31, 2025
M
Regine Company computed a pre-tax financial income of P6,000,000 for the year ended December 31, 2020. The following differences are noted between taxable and accounting income:· Nontaxable revenue: P600,000· Nondeductible expense: P200,000· Warranty provision accrued and expensed in 2020 but tax-deductible when paid: P300,000· Excess tax depreciation over accounting depreciation: P250,000· Excess of accounting revenue over tax revenue (timing difference): P200,000Current tax rate for 2020 is 32% while tax rate for 2021 and forward is 30%. How much is the total tax expense? a. 1,744,000 b. 1,699,000 c. 1,789,000 d. 1,792,000
The pretax financial income (or Loss) figures for Limerick co. are as follows: 2017 83,000 2018 (53,000) 2019 (36,000) 2020 115,000 2021 104,000 Pretax financial income( or loss) and taxable income(loss) were the same for all years involved. Assume a 25% tax rate for 2017 and a 20% tax rate for the remaining years. Prepare the journal entires for the years 2017 to 2021 to record income tax expense and the effects of the net operating loss carryforward. All income and losses relate to normal operations (in recording the benefits of a loss carryforward assume that no valuation account is deemed necessary.
Coronado Corporation, a private company, began operations on January 1, 2020. During its first three years of operations. Coronado reported net income and declared dividends as follows: 2020 2021 2022 Net income $50,000 130,000 151,000 Dividends declared Effective tax rate $0 50,000 The following information is for 2023: 50,000 Income before income tax Correction of prior period error: understatement of 2021 depreciation expense (before tax) Cumulative increase in prior years' income from change in inventory method (before tax) Dividends declared (of this amount, $25,000 will be paid on January 15, 2024) $320,000 Coronado Corporation Statement of Retained Earnings 35,000 45,000 100.000 40% Prepare a 2023 statement of retained earnings for Coronado. The company follows ASPE. (List items that increase retained earnings first after adjusted balance. Enter negative amounts using either o negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
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A company reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Year Pretax Income (Loss) Tax Rate 2018 $142,000 17% 2019 94,000 17 2020 (208,800) 22 2021 318,500 22 In 2021, what amount of income tax payable should be reported for the company, assuming the loss can carry forward?