Trumpet and Trombone Manufacturing, Inc. began the year with a retained earnings balance of $545,000. The company had a great year and earned a net income of $190,000 this year and paid dividends of $14,000. Additionally, the company's controller determined that it had made an error when calculating tax expense in the preceding year, resulting in an understated expense amount of $22,000. What is the ending retained earnings balance?
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- Juroe Company provided the following income statement for last year: Juroes balance sheet as of December 31 last year showed total liabilities of 10,250,000, total equity of 6,150,000, and total assets of 16,400,000. Refer to the information for Juroe Company on the previous page. Also, assume that Juroes total assets at the beginning of last year equaled 17,350,000 and that the tax rate applicable to Juroe is 40%. Required: Note: Round answers to two decimal places. 1. Calculate the average total assets. 2. Calculate the return on assets.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?Saginaw Incorporated completed its first year of operations with a pretax loss of $627,500. The tax return showed a net operating loss of $756,500, which the company will carry forward. The $129,000 book-tax difference results from excess tax depreciation over book depreciation. Management has determined that it should record a valuation allowance equal to the net deferred tax asset. Assuming the current tax expense is zero, prepare the journal entries to record the deferred tax provision and the valuation allowance. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) Required: a. Prepare the journal entry to record the deferred tax consequences for recognition of the current year NOL before considering the valuation allowance. b. Prepare the journal entry to record the deferred tax consequences of the depreciation book-tax difference. c. Prepare the journal entry to record the deferred tax consequences of the valuation…
- Romie Ltd is preparing accounts for the year ended 31 December 20X5. The company has an estimated tax charge of $35,000 for the year ended December 20X5. The trial balance includes an entry of $2,000 relating to an over provision of tax in the previous financial year. What is the charge for tax in the statement of profit or loss for the year ended December 20X5?In 20X6, Dalia Corp., a calendar fiscal-year company, discovered that depreciation expense was erroneously overstated $67,000 in both 20X4 and 20X5 for financial reporting purposes. Net income in 20X6 is correct. The tax rate is 25%. The error was made only for financial reporting, affecting depreciation and deferred income tax accounts. CCA had been recorded correctly, and thus there will be ho change in taxes payable. Additional information: 20X6 20X5 Beginning retained earnings $454,000 Earnings (includes error in 20X5) Dividends declared 85,400 62,200 $430,400 95,900 72,300 Required: 1. Record the entry in 20X6 to correct the error. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Record the entry for 20X6 to correct the error.In 20X6, Dalia Corp., a calendar fiscal-year company, discovered that depreciation expense was erroneously overstated $68,000 in both 20X4 and 20X5 for financial reporting purposes. Net income in 20X6 is correct. The tax rate is 35%. The error was made only for financial reporting, affecting depreciation and deferred income tax accounts. CCA had been recorded correctly, and thus there will be no change in taxes payable. Additional information: Z0X6 Beginning retained earnings $456,000 zexs $432,500 Earnings (includes error in 20x5) Dividends declared 85,800 62,500 96,400 72,900 Required: 1. Record the entry in 20X6 to correct the error. (If no entry is required for a transaction/event, select "No Journal entry required" In the first account field.) Answer is not complete. General Journal Debit Credit 136,000 23,800x 112,200x No 1 Date 20X6 Deferred income tax liability Retained earnings, error correction 2. Prepare the comparative retained earnings section of the statement of changes…
- Whipporwill, Incorporated's, net income for the most recent year was $9,551. The tax rate was 23 percent. The firm paid $4,695 in total interest expense and deducted $5,162 in depreciation expense. a. What was the company's taxable income for the year? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. b. What was the company's EBIT for the year? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. c. What was the company's cash coverage ratio for the year? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.In 20X6, Dalia Corp., a calendar fiscal-year company, discovered that depreciation expense was erroneously overstated $67,000 in both 20X4 and 20X5 for financial reporting purposes. Net income in 20X6 is correct. The tax rate is 25%. The error was made only for financial reporting, affecting depreciation and deferred income tax accounts. CCA had been recorded correctly, and thus there will be no change in taxes payable. Additional Information: 20X6 20X5 Beginning retained earnings $454,000 $430,400 Earnings (includes error in 20X5) Dividends declared 85,400 95,900 62,200 72,300Tyson 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.
- A company reports pretax accounting income of $30 million, but because of a single temporary difference, taxable income is $32 million. No temporary differences existed at the beginning of the year, and the tax rate is 25%. Prepare the appropriate journal entry to record income taxes.In 20X6, Dalia Corp., a calendar fiscal-year company, discovered that depreciation expense was erroneously overstated $58,000 in both 20X4 and 20X5 for financial reporting purposes. Net income in 20X6 is correct. The tax rate is 30%. The error was made only for financial reporting, affecting depreciation and deferred income tax accounts. CCA had been recorded correctly, and thus there will be no change in taxes payable. Additional information: 20X6 S Beginning retained earnings $446,000 20X5 $424,100 Earnings (includes error in 20x5) Dividends declared 83,800 61,300 94,200 2,300 Required: 1. Record the entry in 20X6 to correct the error. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)Labrador Corp. reports a net operating loss of $100,000 during its first year of operations. The company is subject to a tax rate of 30%. Management expects that taxable income will more likely than not be $50,000 during Year 2 and $80,000 during Year 3. What is the amount of the deferred tax asset that will be recognized at the end of Year 1? deferred tax asset