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 come for 2022

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 come for 2022

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 4BCRQ

See similar textbooks

Similar questions

The following information relates to Wildhorse Corp.: At July 1, 2019 At June 30, 2020 Temporary difference, giving rise to future taxable amounts $28,600 $79,800 Temporary difference, giving rise to future deductible amounts 18,700 54,800 Accounting income for the year ended June 30, 2020 was $70,200. 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. Wildhorse Corp. follows ASPE. Calculate the amount of taxable income for 2020. Taxable Income $ eTextbook and Media List of Accounts
Sherrod, Incorporated, reported pretax accounting income of $96 million for 2024. The following information relates to differences between pretax accounting income and taxable income: a. Income from installment sales of properties included in pretax accounting income in 2024 exceeded that reported for tax purposes by $7 million. The installment receivable account at year-end 2024 had a balance of $8 million (representing portions of 2023 and 2024 installment sales), expected to be collected equally in 2025 and 2026. b. Sherrod was assessed a penalty of $2 million by the Environmental Protection Agency for violation of a federal law in 2024. The fine is to be paid in equal amounts in 2024 and 2025. c. Sherrod rents its operating facilities but owns one asset acquired in 2023 at a cost of $112 million. Depreciation is reported by the straight-line method, assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight-line depreciation the…
The information that follows pertains to Esther Food Products: a. At December 31, 2024, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses b. No temporary differences existed at the beginning of 2024. c. Pretax accounting income was $46,000 and taxable income was $9,000 for the year ended December 31, 2024. d. The tax rate is 25%. Required: Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024. Complete this question by entering your answers in the tabs below. Calculation General Journal $ 32,000 11,000 (6,000) Complete the following table given below to record income taxes for 2024. Note: Amounts to be deducted should be entered with a minus sign. Description Pretax accounting income Permanent differences Income subject to taxation Temporary Differences Income taxable in current year $ Amount 46,000 X Tax Rate = x X Recorded as:
An entity reported taxable income of P 8,000,000 during 2019. Its first year of operations.The following are the differences that cause financial income to differ from taxable incomeexcess tax depreciation over accounting depreciation, P 500,000, revenue collected fortax in excess of accounting revenue, P 2,000,000 and tax penalties as an expense in theincome statement, P 200,000. The income tax rate is 30%1. What total tax expense should be reported for 2019?a. 1,890,000b. 2,400,000c. 1,950,000d. 2,010,0002. What is the net deferred tax expense or benefit for 2019?a. 450,000 expenseb. 450,000 benefitc. 510,000 expensed. 510,000 benefit
Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary differences existing at December 31, 2020. 1. Mooney Co. has developed the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 2025 Taxable amounts $300 $300 $300 $ 300 $300 Deductible amount — — — (1,600) — 2. Roesch Co. has the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 Taxable amounts $300 $300 $ 300 $300 Deductible amount — — (2,300) — Both Mooney Co. and Roesch Co. have taxable income of $4,000 in 2020 and expect to have taxable income in all future years. The tax rates enacted as of the beginning of 2020 are 30% for 2020–2023 and 35% for years thereafter. All of the underlying temporary differences relate to noncurrent assets and liabilities. Instructions For each of these two situations, compute the net amount of deferred income taxes to be reported at the end of…
Book Sherrod, Incorporated, reported pretax accounting income of $82 million for 2024. The following information relates to differences between pretax accounting income and taxable income: a. Income from installment sales of properties included in pretax accounting income in 2024 exceeded that reported for tax purposes by $7 million. The installment receivable account at year-end 2024 had a balance of $8 million (representing portions of 2023 and 2024 installment sales), expected to be collected equally in 2025 and 2026. b. Sherrod was assessed a penalty of $3 million by the Environmental Protection Agency for violation of a federal law in 2024. The fine is to be paid in equal amounts in 2024 and 2025. c. Sherrod rents its operating facilities but owns one asset acquired in 2023 at a cost of $84 million. Depreciation is reported by the straight-line method, assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight- line depreciation the…
Information for Kent Corp. for the year 2021: Reconciliation of pretax accounting income and taxable income: Pretax accounting income $ 174,000 Permanent differences (15,200 ) 158,800 Temporary difference-depreciation (12,900 ) Taxable income $ 145,900 Cumulative future taxable amounts all from depreciation temporary differences: As of December 31, 2020 $ 12,700 As of December 31, 2021 $ 25,600 The enacted tax rate was 30% for 2020 and thereafter. What would Kent's income tax expense be in the year 2021?
The information that follows pertains to Esther Food Products: a. At December 31, 2024, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses $ 52,000 22,000 (19,000) b. No temporary differences existed at the beginning of 2024. c. Pretax accounting income was $74,000 and taxable income was $19,000 for the year ended December 31, 2024. d. The tax rate is 25%. Required: Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2024. Complete this question by entering your answers in the tabs below. Calculation General Journal Complete the following table given below to record income taxes for 2024. Note: Amounts to be deducted should be entered with a minus sign. Description Pretax accounting income Permanent differences Income subject to taxation Temporary Differences Income taxable in current year Calculation General Journal Amount Tax Rate $…
1. Pretax accounting income was S70 million and taxable income was $8 million for the year ended December 31, 2021. 2. The difference was due to three items: a. Tax depreciation exceeds book depreciation by $60 million in 2021 for the business complex acquired that year. This amount is scheduled to be $80 million in 2022 and to reverse as ($70 million) and ($70 million) in 2023 and 2024, respectively. b Insurance of $8 millian was paid in 2021 for 2022 coverage C. A $6 million loss contingency was accrued in 2021, to be paid in 2023. 3. No temporary differences existed at the beginning of 2021. 4. The tax rate is 25% Required: 1. Determine the amounts necessary to record income taxes for 2021, and prepare the appropriate journal entry 2. Assume the enacted federal income tax law specifies that the tax rate will change from 25% ta 20% in 2023. When scheduling the reversal of the depreciation difference, you were uncertain as to how to deal with the fact that the difference will continue…
The books of Chicago Company for the year ended December 31, 2020 showed pretax income of P720,000. In computing the taxable income for income tax purposes, the following temporary differences were taken into account.Depreciation deducted for tax purposes in excess of depreciation recorded in the books- P32,000Income from installment sales reportable for tax purposes in excess of income recognized in the books- P24,0001. What amount should Chicago Company record as current income tax liability at December 31, 2020 assuming a corporate income tax rate of 30%?
Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary differences existing at December 31, 2020.1. Buffalo Co. has developed the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 2025 Taxable amounts $ 200 $ 200 $ 200 $ 200 $ 200 Deductible amount — — — ( 1,400 ) 2. Carla Co. has the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 Taxable amounts $ 200 $ 200 $ 200 $ 200 Deductible amount — — ( 2,200 ) — Both Buffalo Co. and Carla Co. have taxable income of $ 4,800 in 2020 and expect to have taxable income in all future years. The tax rates enacted as of the beginning of 2020 are 30% for 2020–2023 and 35% for years thereafter. All of the underlying temporary differences relate to noncurrent assets and liabilities.1. Compute the net amount of deferred…
Information for Kent Corp. for the year 2021: Reconcillation of pretax accounting income and taxable income: Pretax accounting income $180,000 (15,000) 165,000 (12,000) Permanent differences Temporary difference-depreciation Taxable income $153,000 Cumulative future taxable amounts all from depreciation temporary differences: As of December 31, 2020 $13,000 $25,000 As of December 31, 2021 The enacted tax rate vwas 25% for 2020 and thereafter. What should be the balance in Kent's deferred tax liability account as of December 31, 2021? Multiple Choice Prev 8 of 39 Next > Question no....pages ....pdf 7 Question no....pages MacBook Air