cesPetrilli Ltd. had a taxable loss of $4,500,000 in 20X8 and a further loss of $230,000 in 20X9. The tax rate in 20X8 was 32% and in20X9, 33%. All rates are enacted in the year to which they pertain. In the three years before the losses, the company had the followingtaxable income and tax rates:Taxable incomeTax rate20X520X6$1,584,000 $1,710,000Refund amount$36%There are no temporary differences other than those created by income tax losses. The company was struggling due to a competitorentering the market.Required:1. What is the amount of refund that will be claimed in 20X8?038%20X7$689,60040%The amount of the tax loss carryforward2. What is the amount of the loss carryforward in 20X8?$4,500,000

The concept of loss carryforward is based on the principle that if a company incurs a tax loss in a…

Answered: Required: 1. What is the amount of…

PAYROLL ACCT.,2019 ED.(LL)-TEXT

19th Edition

ISBN:9781337619783

Author:BIEG

Publisher:BIEG

Chapter5: Unemployment Compensation Taxes

Section: Chapter Questions

Problem 5PA

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The Bookbinder Company had 500,000 cumulative operating losses prior to the beginning of last year. It had 100,000 in pre-tax earnings last year before using the past operating losses and has 300,000 in the current year before using any past operating losses. It projects 350,000 pre-tax earnings next year. a. How much taxable income was there last year? How much, if any, cumulative losses remained at the end of the last year? b. What is the taxable income in the current year? How much, if any, cumulative losses remain at the end of the current year? c. What is the projected taxable income for next year? How much, if any, cumulative losses are projected to remain at the end of next year?
Petrilli Ltd. had a taxable loss of $3,600,000 in 20X8 and a further loss of $140,000 in 20X9. The tax rate in 20X8 was 32% and in 20X9, 33%. All rates are enacted in the year to which they pertain. In the three years before the losses, the company had the following taxable income and tax rates: 20X5 20X6 20X7 Taxable income $ 1,267,200 $ 1,368,000 $ 488,400 Tax rate 36 % 38 % 40 % There are no temporary differences other than those created by income tax losses. The company was struggling due to a competitor entering the market. Required:1. What is the amount of refund that will be claimed in 20X8? 2. What is the amount of the loss carryforward in 20X8? 3. Assuming that loss carryforward usage is probable in each year, prepare a journal entry for income tax in 20X8 and 20X9. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 4. Assuming that loss carryforward usage is not probable in…
Petrilli Ltd. had a taxable loss of $3,600,000 in 20X8 and a further loss of $140,000 in 20X9. The tax rate in 20X8 was 32% and in 20X9, 33%. All rates are enacted in the year to which they pertain. In the three years before the losses, the company had the following taxable income and tax rates: 20X5 20X6 20X7 Taxable income $ 1,267,200 $ 1,368,000 $ 488,400 Tax rate 36 % 38 % 40 % There are no temporary differences other than those created by income tax losses. The company was struggling due to a competitor entering the market. Assuming that loss carryforward usage is not probable in each year, prepare a journal entry for income tax in 20X8 and 20X9. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Record the entry in loss year 20X8 when the provision is not met. Record the entry in loss year 20X9 when the provision is not met.
Eurgher Ltd. had a taxable loss of $354,000 in 20X7. The tax rate in 20X7 is 32%. In the past three years, the company had the following taxable income and tax rates: Taxable income Tax rate 20X5 20X4 $236,000 $141,600 Refund amount 36% 38% 20X6 $94,400 40% There are no temporary differences other than those created by income tax losses. Required: 1. What is the amount of refund that will be claimed in 20X7, taking the loss back to the oldest possible year, first? Provide the journal entry for income tax receivable in 20X7. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) =
Tyson Corporation reported pretax income from operations in Year 1 of 92,000 (the first year of operations). In Year 2, the corporation experienced a $96,000 NOL (pretax loss from operations). Management is confident the company will have taxable income in excess of $120,000 in Year 3. Assume an income tax rate of 25% in Year 1 and thereafter. Tyson has no other temporary differences. Required a. Provide the Year 1 and Year 2 income tax entries that Tyson should make.
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 250,000 Permanent difference (14,600 ) 235,400 Temporary difference-depreciation (19,200 ) Taxable income $ 216,200 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as income tax payable for its first year of operations? $4,800. $62,500. $58,850. $54,050.
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $220,000 Permanent difference (14,200) 205,800 Temporary difference - depreciation (21,000) Taxable income $ 184,800 Tringali's tax rate is 25 %. Assume that no estimated taxes have been paid. What should Tringali report as its income tax expense for its first year of operations?
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $265,000. Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its income tax expense for its first year of operations? 1. A) $75,000. 2. B) $66,250. 3. C) $71,250 4. D) $5,000. O A O B O C O D
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 280,000 Permanent difference (15,600 ) 264,400 Temporary difference-depreciation (20,900 ) Taxable income $ 243,500 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its deferred income tax liability as of the end of its first year of operations?
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income Permanent difference Temporary Taxable income difference-depreciation $370,000 (15,000) 355,000 (19,100) $335,900 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as income tax payable for its first year of operations?
For the year ended December 31, year 1, Tyre Co. reported pretax financial statement income of $7,500,000. Its taxable income was $6,500,000. 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 year 1 of $900,000. 1. What amount should be reported as current tax expense for the current year? a. 2,250,000 b. 1,950,000 c. 1,050,000 d. 1,350,000 2. What amount should be reported as total income tax expense? a. 1,350,000 b. 1,950,000 c. 1,050,000 d. 2,250,000 3. What amount of income tax payable should be presented at year end? a. 2,250,000 b. 1,350,000 c. 1,950,000 d. 1,050,000
In its first 3 years of operations, Batul Company had taxable income of $90,000 in the first year, a loss of $570,000 in the second year, and income of $600,000 in the current year. The tax rate is 20% in the first 2 years and 28% in the current year. How much is the income tax liability in the current year? ($600,000 – ($600,000 x .80)) x .28 ($570,000 - ($570,000 x .80)) x .20 ($600,000 – ($600,000 x .72)) x .28 ($600,000 – ($600,000 x .80)) x .20

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Required: 1. What is the amount of refund that will be claimed in 20X8? Refund amount $ 2. What is the amount of the loss carryforward in 20x8? The amount of the tax loss carryforward $ 4,500,000