During 2019 and 2020, Faulkner Manufacturing used the sum-of-the-years’-digits (SYD) method of depreciation for its depreciable assets, for both financial reporting and tax purposes. At the beginning of 2021, Faulkner decided to change to the straight-line method for both financial reporting and tax purposes. A tax rate of 25% is in effect for all years. For an asset that cost $11,200 with an estimated residual value of $1,200 and an estimated useful life of 10 years, the depreciation under different methods is as follows: Year Straight Line SYD Difference 2019   $ 1,000   $ 1,818     $ 818   2020     1,000     1,636       636       $ 2,000   $ 3,454     $ 1,454     Required: 1. Prepare the journal entry that Faulkner will record in 2021 related to the change. 2. Suppose instead that Faulkner previously used straight-line depreciation and changed to sum-of-the-years’- digits in 2021. Prepare the journal entry that Faulkner will record in 2021 related to the change.   Please avoid solutions image based thanku

At the beginning of 2019, PT XYZ purchased an asset for Rp600.000 with an estimated useful life of 5 years and an estimated residual value of Rp50.000. For financial reporting purposes the asset is being depreciated using the straight-line method; for tax purposes the double-declining-balance method is being used. ABC’s tax rate is 40% for 2019 and all future years. At the end of 2019, which of the following deferred tax accounts and balances is reported on ABC’s statement of financial position?

Bramble Corp. purchased depreciable assets costing $550,000 on January 2, 2023. For tax purposes, the company uses CCA in a class that has a 40% rate. Assume these assets are considered "eligible equipment" for purposes of the Accelerated Investment Incentive (under the All, instead of using the half-year rule, companies are allowed a first-year deduction using 1.5 times the standard CCA rate). For financial reporting purposes, the company uses straight-line depreciation over 5 years. The enacted tax rate is 30% for all years. This depreciation difference is the only reversing difference the company has. Assume that Bramble has income before income tax of $345,000 in each of the years 2023 to 2027. Calculate the amount of capital cost allowance and depreciation expense from 2023 to 2027, as well as the corresponding balances for carrying amount and undepreciated capital cost of the depreciable assets at the end of each of the years 2023 to 2027. (Enter negative amounts using either a…

Francis Corporation purchased an asset at a cost of $50,000 on March 1, 2020. The asset has a useful life of 8 years and a salvage value of $4,000. For tax purposes, the MACRS class life is 5 years. Compute tax depreciation for each year 2020–2025.

SINCO Ltd. purchased a piece of equipment in the year 2018 for the sum of $ 200,000. The company is subject to a tax depreciation rate of 25%. According to the following table, what is the depreciation allowance that this company can claim in 2020? (in the following picture : Année is year)

At the end of 2021, Schrutte Inc. in its first year of operations, had pretax financial income of $650,000.  The company had extra depreciation taken for tax purposes in the amount of $975,000.  Estimated expenses that were deducted for financial income but not yet paid amounted to $425,000. It is estimated that the expenses will be paid in 2022. The tax rate for all years is 25% In the journal entry at the end of the year that records income tax expense, deferred taxes and income taxes payable, what is the entry to the Income Tax Payable account?   Question 19 options:   a)  credit Income Tax Payable account by $162,500   b)  credit Income Tax Payable account by $300,000.   c)  credit to Income Tax Payable account by $25,000.   d)  credit Income Tax Payable account by $512,500.

On January 1, 2018, Ameen Company purchased major pieces of manufacturing equipment for a total of $36 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax reporting. At December 31, 2020, the book value of the equipment was $30 million and its tax basis was $20 million. At December 31, 2021, the book value of the equipment was $28 million and its tax basis was $12 million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2021 was $50 million. Required: 1. Prepare the appropriate journal entry to record Ameen's 2021 income taxes. Assume an income tax rate of 25%. 2. What is Ameen's 2021 net income?

Assume that Maddox Corporation buys new equipment for $15,000 on January 1, 2021. Depreciation for book purposes using the SL method is $3,000 per year. For tax purposes SYD is used with depreciation of $5,000 in 2021 and $4,000 in 2022. Depreciation is the only book - versus - tax difference. Income before depreciation and taxes is $30,000 each year over the next five years and the statutory tax rate is 35% for 2021. The tax rate increased to 40% in 2022. Calculate the increase in the deferred tax liability for 2022. Multiple choice question. $1,200 $250 $700 $500

Brown Corp has a deferred tax asset account with balance of $80,000 at the end of 2019 due to a single cumulative temporary difference of $350,000. At the end of 2020, this same temporary difference has increased to cumulative amount of $410,000. Taxable income for 2020 is $800,000. The tax rate is 25% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2019. What one of the following is correct about the journal entry to record Brown's 2020 income tax expense? Group of answer choices Dr. Deferred tax asset $15,000 Dr. Deferred tax liability $25,000 Dr. Income tax expense $200,000 Cr. Tax payable $112,000

Caramel Company at the end of 2022, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income- 3,000,000 Estimated litigation expense- 4,000,000 Excess tax depreciation- (6,000,000) Taxable Income- 1,000,000 The estimated litigation expense of 4,000,000 will be deductible in 2023 when it is expected to be paid. Th edepreciable assets will result in deductible amounts of 2,000,000 in each of the next three years. The income tax rate is 20% for all years. The amount of deferred tax liability to be recognized for 2022 is