Betty Smith is the owner of Accurate Tax Service. For the year ending April 30, 2019, the following information is available for thisservice business. At the beginning of this accounting period, the balance in the Betty Smith, Capital account was $30.500. Following isa summary of activities during this accounting period:Betty Smith, capital withdrawn: $17,000Revenue from income tax preparation: $71,200Revenue from monthly clients: $42,400Salaries expense: $12,300Advertising expense: $610Rent expense: $7,300Automobile expense: $1,700Office supplies expense: $7,200.Note: You should assume that all profit (or loss) accrued during this accounting period is absorbed into the Betty Smith, Capitalaccount at the end of the period.Following are the account balances at the end of this accounting period (except Betty Smith, Capital):Cash: $62,500Accounts receivable: $3,800Office furniture and fixtures: $10,200Office machines and computers: $17,000Automobile: $8,500Accounts payable: $1,600 Prepare an income statement for the year ending April 30, 2019.ACCURATE TAX SERVICEINCOMEYear EndedREVENUEEXPENSESSalariesSTATEMENTApril 30, 2019Rent$SAdvertising $$Automobile $Office Supplies $NET INCOME $62500003800102000

Lets understand the basics.Income statement gets prepared in order to calculate total revenue, total…

Answered: REVENUE EXPENSES Salaries Advertising $…

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

ChapterMB: Model-building Problems

Section: Chapter Questions

Problem 12M

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How do the all events and economic performance requirements apply to the following transactions by an accrual basis taxpayer? a. The company guarantees its products for six months. At the end of 2019, customers had made valid claims for 600,000 that were not paid until 2020. Also, the company estimates that another 400,000 in claims from 2019 sales will be filed and paid in 2020. b. The accrual basis taxpayer reported 200,000 in corporate taxable income for 2019. The state income tax rate was 6%. The corporation paid 7,000 in estimated state income taxes in 2019 and paid 2,000 on 2018 state income taxes when it filed its 2018 state income tax return in March 2019. The company filed its 2019 state income tax return in March 2020 and paid the remaining 5,000 of its 2019 state income tax liability. c. An employee was involved in an accident while making a sales call. The company paid the injured victim 15,000 in 2019 and agreed to pay the victim 15,000 a year for the next nine years.
Betty Smith is the owner of Accurate Tax Service. For the year ending April 30, 2019, the following information is available for this service business. At the beginning of this accounting period, the balance in the Betty Smith Capital account was $32,000. Following is a summary of activities during this accounting period: Note: You should assume that all profit (or loss) accrued during this accounting period is absorbed into the Betty Smith Capital account at the end of the period. Following are the account balances at the end of this accounting period (except Betty Smith Capital): Solve, a. Prepare an income statement for the year ending April 30, 2019. b. Prepare a balance sheet as of April 30, 2019.
As the accountant for Monroe Trucking Company, you are preparing the company’s annual return, Form 940 andSchedule A. Use the following information to complete Form 940 and Schedule A on pages 5-52 to 5-54.The net FUTA tax liability for each quarter of 2019 was as follows: 1st, $97.00; 2nd, $87.00; 3rd, $69.70; and 4th,$59.50.Since the net FUTA tax liability did not exceed $500, the company was not required to make its first deposit ofFUTA taxes until January 31, 2020. Assume that the electronic payment was made on time.a. One of the employees performs all of his duties in another state—Louisiana.b. Total payments made to employees during calendar year 2019:Texas..........................$53,450Louisiana ...................22,150Total ..........................$75,600c. Employer contributions into employees’ 401(k) retirement plan: $1,250.d. Payments made to employees in excess of $7,000: $22,150.e. Form is to be signed by Vernon Scott, Vice President, and dated 1/31/20.f. Phone…
Assume that Shoreline Hotel Inc., (SHI) decides to make the following entry on December 31, 2018. Current tax rate is 40%. DR Current income tax expense $634,800 CR Income tax payable $634,800 This would imply that Select one: a. the taxable income for 2018 was different than the accounting income. b. the income tax expense reported by SHI on its income statement would be $750,000. c. the taxable income for 2018 was determined to be $1,587,000. d. All of the above. e. None of the above.
Wise Company began operations at the beginning of 2021. The following information pertains to this company. 1. Pretax financial income for 2021 is $100,000. 2. The tax rate enacted for 2021 and future years is 20%. 3. Differences between the 2021 income statement and tax return are listed below: a. Warranty expense accrued for financial reporting purposes amounts to $7,000. Warranty deductions per the tax return amount to $2,000. b. Gross profit on construction contracts using the percentage-of-completion method per books amounts to $92,000. Gross profit on construction contracts for tax purposes amounts to $67,000. c. Depreciation of property, plant, and equipment for financial reporting purposes amounts to $60,000. Depreciation of these assets amounts to $80,000 for the tax return. d. A $3,500 fine paid for violation of pollution laws was deducted in computing pretax financial income. e. Interest revenue recognized on an investment in tax-exempt municipal…
Accounting for personal income taxes Prepare journal entries to record these transactions and events. 1. During 2022 Leavitt County collected personal income taxes in the amount of $3,200,000 as a result of withholdings by employers and payments of estimated taxes by taxpayers for 2022. 2. At year-end Leavitt County's Finance Director estimated that, by April 15, 2023 (when taxpayers are required to file their final tax returns for 2022), taxpayers will make payments of $175,000 with their tax returns and request refunds of $320,000. 3. The Finance Director also estimated that late filers will pay $45,000 of taxes applicable to 2022 when they ultimately file their tax returns. Leavitt County's written policy regarding personal income taxes is to consider only payments received with final returns by April 15 as "available." Account Debit Credit 1. Cash 3,200,000 Revenues - income taxes 3,200,000 To record taxes collected in 2022. 2. Deferred inflow of resources - income taxes 175,000…
At the beginning of 2021, Pitman Co. had pretax financial income of $1,200,000. Additionally, there was a timing difference of $300,000 due to an accounts receivable that will not be collected until the following year. The tax rate us 30%. A. Calculate the total taxable income for 2021. B. Calculate Income tax expense, income tax payable, and the deferred amount for 2021, and create the journal entry.
Music Media Ltd. prepares statements quarterly. Port Ai Required: 1. Based on 2019 results, Music's estimated tax liability for 2020 is $303,960. Music will accrue 1/18 of this amount at the end of each month (assume the installments are paid the next day) Prepare the entry on January 31, 2020, to accrue the tax liability and on February 1 to record the payment. View transaction list Journal entry worksheet 1
Blossom Inc reports the following pre-tax incomes (losses) for both financial reporting purposes and tax purposes Accounting Income Year (Loss) Tax Rate i 2021 $124,000 2022 91,000 2023 (287,000) 2024 218,000 The tax rates lated were all enacted by the beginning of 2021. Blossom reports under the ASPE future Income tavas method. Prepare the journal entries for each of the years 2021 to 2024 to record Income tax. Assume the texclosa la first carried back and that at the end of 2023, the loss carry forward benefits are judged more likely than not to be realized in the future. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem) Date Account Titles and Explanation (To record benefit from losa canryback) (To record deferred benefit from loss…
a) Tax Required Information [The following information applies to the questions displayed below.] FUTA SUTA b) Tax Compute BMX's amounts for each of these four taxes as applied to the employee's gross earnings for September under each of three separate situations (a), (b), and (c). Note: Round your answers to 2 decimal places. BMX Company has one employee. FICA Social Security taxes are 6.2% of the first $137,700 paid to its employee, and FICA Medicare taxes are 1.45% of gross pay. For BMX, Its FUTA taxes are 0.6% and SUTA taxes are 5.4% of the first $7,000 paid to its employee. FICA-Social Security FICA-Me FUTA SUTA Tax a. b. Gross Pay through August 31 $ 6,500 2,800 133,400 FICA-Social Security FICA-Medicare FUTA SUTA FICA-Social Security FICA-Medicare Gross Pay for September $ 1,900 2,900 10,000 September Earnings Subject to Tax September Earnings Subject to Tax September Earnings Subject to Tax Tax Rate Tax Rate Tax Rate Tax Amount Tax Amount Tax Amount
Smith is an accountant in South Company. He reported a pretax financial income of $2,800,000, current tax of $1,001,000 and deferred tax of $168,000 in the income statement at year ended December 31, 2019. In order for you to check the given number, you have obtained the following information:i. Nontaxable dividends of $ 120,000 was received during 2019.ii. On January 3, 2018, the company purchased machinery for $2,400,000. It is depreciated using straight-line method over 8 years for financial reporting purposes and over 5 years for tax purposes. The company is allowed to report half of the depreciation expense amount in the first year and the other halfin 2023 for tax purposes.iii. Tax rate is 35% for all years.South Company wants to use the above information to (1) check the given tax numbers, (2) provide necessary entry to record income taxes for 2019 and (3) show how the recorded accounts are presented on 2019 income statement.
Sun Corporation, a calendar year and accrual method tax payer, provides the following information and asks you to prepare Schedule M-1 for 2019: Net income per books (after-ta×) $ 270,000 Federal income tax per books $ 32,500 Tax-exempt interest income $ 15,000 Life insurance proceeds received as a result of death of corporate president $ 120,000 Interest on loan to purchase tax-exempt bonds $ 1,500 Excess of capital loss over capital gains $ 6,500 Premiums paid on life insurance policy on life of Emerald’s president $ 7,100

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REVENUE EXPENSES Salaries Advertising $ Rent $ Automobile $ 62500 3800