9. Big Red Inc. has taxable income of $500,000 in 2024, however, due to a single temporary difference pretax accounting income is $350,000. the beginning of the year no temporary differences existed and the tax rate is 30%. What amount for deferred taxes would Big Red report on its balance sheet for 2024? A) A deferred tax asset of $45,000 B) A deferred tax liability of $45,000

9. Big Red Inc. has taxable income of $500,000 in 2024, however, due to a single temporary difference pretax accounting income is $350,000. the beginning of the year no temporary differences existed and the tax rate is 30%. What amount for deferred taxes would Big Red report on its balance sheet for 2024? A) A deferred tax asset of $45,000 B) A deferred tax liability of $45,000

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 22CE

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Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and taxable income for 2020. The prior period adjustment was the result of an error in calculating bad debt expense for 2019. The current tax rate is 30%, and no change in the tax rate has been enacted for future years. When the company applies intraperiod income tax allocation, the prior period adjustment will be shown on the: a. income statement at 12,000 b. income statement at 8,400 (net of 3,600 income taxes) c. retained earnings statement at 12,000 d. retained earnings statement at 8,400 (net of 3,600 income taxes)
Barth James Inc. has the following deferred tax assets and liabilities: 12,000 noncurrent deferred tax asset, and 10,500 noncurrent deferred tax liability. Show how Barth James would report these deferred tax assets and liabilities on its balance sheet.
Pretax financial income for Lake Inc. is $300,000, and its taxable income is $100,000 for 2018. Its only temporary difference at the end of the period relates to a $70,000 dif- ference due to excess depreciation for tax purposes. If the tax rate is 40% for all periods, compute the amount of income tax expense to report in 2018. No deferred income taxes existed at the beginning of the year.
Pretax financial statement income for the year ended December 31, 2024 was $180 million for Wilton Company. Wilton's taxable income was $120 million. This was a result of differences between depreciation for financial reporting purposes and tax purposes. The enacted tax rate is 20% for 2024 and 25% thereafter. What amount should Wilton report as the current portion of income tax expense for 2024? $45 million $24 million $30 million $36 million
Pretax financial statement income for the year ended December 31, 2021, was $25 million for Scott Pen Company. Scott's taxable income was $30 million. This was a result of differences between depreciation for financial reporting purposes and tax purposes. The enacted tax rate is 30% for 2021 and 40 % thereafter. What amount should Scott report as the current portion of income tax expense for 2021?
At the end of the year, a deductible temporary difference of $40 million has been recognised due to the difference between the carrying amount of a liability account for estimated expenses and its tax base. Taxable income is $50 million. No temporary differences existed at the beginning of the year, and the tax rate is 35%. Required: a. Prepare the journal entry(s) to record income taxes during the period. b.How much will income tax expense be shown in the income statement? c. What will be the balance sheet disclosure during the period regarding taxes?
Acer, Inc. reported a taxable income of P8,000,000 in its Form 1702 for its first year of operations, calendar year 2020. Below are the differences between taxable and financial income:· Excess tax depreciation over accounting depreciation: P500,000· Revenue collected for tax in excess of accounting revenue: P2,000,000· Tax penalties expensed in the income statement: P200,000Income tax rate is 30%. What is the NET DEFERRED TAX EXPENSE for 2020? a. 450,000 benefit b. 450,000 expense c. 510,000 benefit d. 510,000 expense
Differences between pretax accounting income and taxable income for Ayers Services were as follows during 2022: ($ in millions) Pretax accounting income $ 450 Permanent difference (39 ) 411 Temporary difference (31 ) Taxable income $ 380 The cumulative temporary difference as of the end of 2022 is $100 million (also the future taxable amount). The enacted tax rate is 25%. What is the deferred tax asset or liability to be reported in the balance sheet?
Integrity Company computed a pre-tax financial income of P2,200,000 for its first year of operations ended December 31, 2021. In preparing the income tax return, the accountant determined the following differences between financial and taxable income: Non-deductible expenses – P400,000 Non-taxable revenues – P150,000 Temporary difference (installment sales reported in financial income but not in taxable income) – P700,000 The enacted tax rates and the reversal of the temporary difference are as follows (see image below).How much is the Total Income Tax Expense in 2021? a. P749,000 b. P945,000 c. P762,600 d. P707,400
1. Dunder Mifflin Inc. had one temporary difference in 2022 because their tax depreciation deduction exceeded their book depreciation expense by $74. Dunder Mifflin's pretax financial income is $1204 in 2022 and its tax rate is 20%. The company had no prior deferred tax balance. Dunder Mifflin's journal entry at the end of 2022 will involve: a. A credit to Income Tax Expense of $240.80 b. A debit to Deferred Tax Asset of $14.80 c. A credit to Deferred Tax Liability of $14.80 d. A credit to Income Tax Payable of $240.80
4. For the year ended December 31, 20x1, Tyre Co. reported pretax financial statement income of P750,000. Its taxable income was P650,000. The difference is due to accelerated depreciation for income tax purposes. Tyre’s effective income tax rate is 30%, and Tyre made estimated tax payments during 20x1 of P90,000. What amount should Tyre report as current tax expense for 20x1?
The following information relates to Crane Corp.: At July 1, 2022 At June 30, 2023 Temporary difference, giving rise to future taxable amounts Temporary difference, giving rise to future deductible amounts $28,000 $75,000 18,000 45,000 Accounting income for the year ended June 30, 2023 was $65,000. No permanent differences existed during the fiscal year. The company was expected to operate profitably in the future. The tax rate was 20% for the current and future years. Crane Corp. follows ASPE. (a) Calculate the amount of taxable income for 2023, Taxable Income for 2023 $