The following information relates to Franklin Freightways for its first year of operations (data in millions of dollars): Pretax accounting income: Pretax accounting income included: Overweight fines (not deductible for tax purposes) Depreciation expense Depreciation in the tax return $195 5 70 110 The applicable tax rate is 25%. There are no other temporary or permanent differences. Franklin Freightways should have recorded ($ in millions): Multiple Choice Tax payable of $40. Tax benefit of $10 due to the NOL.
Q: For the year ended 30 June 20X4, Margorie Corp generated taxable operating income of CU 1,200,000 of…
A: Deferred Tax Liability: it records the fact that the company will pay more income tax in future due…
Q: AirParts Corporation reported a net operating loss of $25 million for financial reporting and tax…
A: The net operating loss is considered as negative taxable income. It can be used in other fiscal year…
Q: Kara Fashions uses straight-line depreciation for financial statement reporting and MACRS for income…
A: Deferred Tax Asset Items on a company's balance sheet that may be used to reduce taxable income in…
Q: Gordon Company was started on January 1, 2010 and has two temporary differences between its income…
A: Journal entry refers to the first step in the accounting process, which signifies recording of…
Q: Stephens Company has a deductible temporary difference of $2,000,000 at the end of its first year of…
A: The correct answer is option (d).
Q: Alvis Corporation reports pretax accounting income of $400,000, but due to a single temporary…
A: Calculate the net income of Company Alvis’s:
Q: ABC Company (ABC), a manufacturer of hybrid engine vehicles, had pretax financial income of P30…
A: Solution Taxable income refers to any individual's or business compensation that is used to…
Q: Kara Fashions uses straight-line depreciation for financial statement reporting and MACRS for income…
A: Deferred tax account shows the amount of reconciliation, which occurs due to the difference between…
Q: Riverbed Company reports pretax financial income of $65,000 for 2020. The following items cause…
A: Hey, since there are multiple sub-parts posted, we will answer first three sub-parts.
Q: For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income…
A: Deferred tax liability means liability calculated by finding difference between the comapany taxable…
Q: Bee Corp. prepared the following reconciliation between book income and taxable income for the year…
A: Tax is a liability calculated on the income earned and paid to the government.
Q: Bee Corp. prepared the following reconciliation between book income and taxable income for the year…
A: Current portion of provision for income taxes = Taxable income x income tax rate
Q: xable income is only $115,000. At the beginning of the year, no temporary differences existed.…
A: Explanation of Concept Deferred Tax Assets / Deferred tax Liability : are to be calculated when…
Q: Wheaton Inc. reported the following results for its first three years of operations: 2019 Income…
A: After-tax net income (loss) reported for 2020
Q: Bonita Company reports pretax financial income of $76,500 for 2020. The following items cause…
A: Taxable income: It is the income calculated as per the tax laws and on which the applicable tax…
Q: Kara Fashions uses straight-line depreciation for financial statement reporting and MACRS for income…
A: 1. Calculate the deferred tax liability to be reported in the balance sheet.
Q: obac Company reported an operating loss of $129,000 for financial reporting and tax purposes in…
A: Working Notes
Q: Mabuhay Company prepared the following reconciliation of income per book with income per tax return…
A: Given, Book income before tax=750,000 Taxable temporary difference=100,000 Deductible temporary…
Q: Tobac Company reported an operating loss of $122,000 for financial reporting and tax purposes in…
A: 1). Past Current Future 2019 2020 Operating loss (1,22,000) Carry back…
Q: XYZ, Inc. reports taxable income of $200,000 for 2008 and has a 30% marginal tax rate. The tax rate…
A: Journal entry are the first step in accounting process, signifying the recording part, entries are…
Q: Alvis Corporation reports pretax accounting income of $400,000, but due to a single temporary…
A:
Q: For the year ended December 31, 20x1, Tyre Co. reported pretax financial statement income of…
A: Formula: Current tax expense for 20x1 = Taxable income x tax rate
Q: For the events described below, select the taxrelated term from the following list that best…
A:
Q: Splish Company reports pretax financial income of $65,800 for 2020. The following items cause…
A: Taxable income for a corporation, we have to begin with the financial income as determined under…
Q: At the end of the year, the deferred tax asset account had a balance of $12 million attributable to…
A:
Q: The following information relates to Franklin Freightways for its first year of operations (data in…
A: Here in this question, we are required to calculate tax payable / tax benefit. We know that, when…
Q: Prepare journal entries to record Doubtful's income tax expense for the current year. Show…
A: Journal entries are defined as the first step in the accounting cycle in which the monetary business…
Q: At the end of the year, the deferred tax asset account had a balance of $4 million attributable to a…
A: Journal is the book of original entry in which all the transactions of the business are recorded…
Q: Randolph Company reported pre-tax net income from continuing operations of $800,000 and taxable…
A: Calculations of Current Tax expense and Deferred Tax Expense Current Tax expense = Taxable income…
Q: Liberty Corporation, an S corporation, had the following book-tax differences for the current year:…
A: The AAA is an account used for accounting adjustment to the book income recorded by the company.
Q: In its first year of operations, Seagate Tech reported pretax accounting income of $780 million for…
A: Deferred Tax Liability It is the tax which is due for the current period but it has not yet been…
Q: At December 31, DePaul Corporation had a $16 million balance in its deferred tax asset account and a…
A: Multiple Temporary DifferenceIt is very unlikely to have a single temporary difference in any…
Q: The pre-tax income statements for Moonstone Ltd. for two years (summarized) were as follows: 20X8…
A: SOLUTION TAXABLE INCOME IS THE AMOUNT OF INCOME THAT IS USED TO CALCULATE THE TAXES OWNED BY…
Q: Pine Ltd is reviewing its deferred tax for the year. In each of the following situations prepare the…
A: 1. Depreciation as per Accounting=Asset value×SLM rate=$200,000×20%=$40,000 Depreciation as per…
Q: Milo Manufacturing uses straight-line depreciation for financial statement reporting and is able to…
A:
Q: Livia Company’s pretax income was $72,000. To compute taxable income, the following information is…
A: Income tax is liability of taxes to be paid to the government on the income earned. Taxable income…
Q: Alvis Corporation reports pretax accounting income of $300,000, but due to a single temporary…
A: Since taxable income is less than pre tax income, a future taxable amount will occur once the…
Q: For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income…
A: Deferred tax liability: The deferred tax liability is the excess, over received, or received in…
Q: Milo Manufacturing uses straight-line depreciation for financial statement reporting and is able to…
A: Journal: Recording of a business transactions in a chronological order.
Q: The finance director of Hyden Ltd is unsure about the deferred tax implications for two of the items…
A: Prepaid insurance, tax-deductible when paid. This would be expensed for accounting purposes later…
Q: Teal Company reports pretax financial income of $72,600 for 2020. The following items cause taxable…
A: Taxable income = Pretax financial income + Excess rent collected + Fine paid for pollution
Q: On December 31, Year 1, ABC Corp had a deferred tax asset of $56,470. On December 31, Year 2, the…
A: Deferred tax asset is basically overpayment or sometimes advance payment of taxes.
Q: Red, Incorporated has book income of $500,000 before federal income tax expense which includes…
A: The deferred tax asset would arise on difference between book income qnd taxable income of $10000…
Q: Milo Manufacturing uses straight-line depreciation for financial statement reporting and is able to…
A: Calculation of deferred tax liability and recording of journal entry are as follows
Q: . Pine Corporation’s books showed pretax income of P600,000 for the year ended December 31, 20x1. In…
A: Income tax liability will be calculated on the taxable income of the business. There may be some…
Q: Marigold Company reports pretax financial income of $72,000 for 2020. The following items cause…
A: Compute taxable income and income taxes payable for 2020.
Q: For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income…
A: Income tax payable is the Amount of tax liability on taxable income which is to be paid.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.) Sales Costs Depreciation EBIT Taxes (23%) Net income $ 659,000 420,100 98,900 a. Calculate the OCF. (Do not round intermediate calculations.) b. What is the depreciation tax shield? (Do not round intermediate calculations.) a. OCF $ 206,580 b. Depreciation tax shieldThe following information relates to Franklin Freightways for its first year of operations (data in millions of dollars): Pretax accounting income: $ 195 Pretax accounting income included: Overweight fines (not deductible for tax purposes) 5 Depreciation expense 70 Depreciation in the tax return 110 The applicable tax rate is 25%. There are no other temporary or permanent differences. Franklin Freightways should have recorded ($ in millions): Tax benefit of $10 due to the NOL. Tax payable of $22.5. Tax payable of $40. Tax payable of $48.75.Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.) Sales 2$ 665,000 Costs 427,100 Depreciation 101,900 EBIT Taxes (23%) Net income Calculate the OCF. (Do not round intermediate calculations.) What is the depreciation tax shield? (Do not round intermediate calculations.) 1 OCF Depreciation tax shield
- Misty Company reported the following before-tax items during the current year: Sales revenue Selling and administrative expenses. Restructuring charges. Loss on discontinued operations Misty's effective tax rate is 40%. What is Misty's net income for the current year? $148. $168. $112. None of these answer choices are correct. $600 250 20 50 IMabuhay Company prepared the following reconciliation of income per book with income per tax return for the year ended December 31, 2006Book income before tax, 750,000Add temporary difference: Construction revenue which will reverse in 2007, 100,000Deduct temporary difference: Depreciation expense which will reverse in equal amounts in each of the next four years, (400,000)Taxable income, 450,000The income tax rate is 35%.What amount should Mabuhay report in its 2006 income statement as the current provision for income tax?a. 157,500 b. 262,500 c. 297,500 d. 367,500Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.) Sales 2$ 659,000 Costs 420,100 Depreciation 98,900 EBIT Taxes (23%) Net income b. Calculate the OCF. (Do not round intermediate calculations.) What is the depreciation tax shield? (Do not round intermediate calculations.) C. b. OCF с. Depreciation tax shield
- Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.) Sales Costs Depreciation EBIT Taxes (24%) Net income b. b. Calculate the OCF. (Do not round intermediate calculations.) c. What is the depreciation tax shield? (Do not round intermediate calculations.) C. $ OCF 662,600 424,300 100,700 Depreciation tax shieldThis is a multiple answer question. Babcock Company just completed its first year of operations and has a net operating loss for tax purposes of $100,000. Babcock expects to be profitable within the next two years. The enacted tax rate is 40%. Which of the following components are included in the journal entry to record the NOL carryforward? (Choose all that apply) A. credit taxes payable $40,000 B. debit income tax expense $40,000 C. credit income tax expense $40,000 D.debit deferred tax asset $40,000 E. credit deferred tax liability $40,0001. Pine Corp.'s books showed pretax income of P800,000 for the PROBLEM 6: MULTIPLE CHOICE - COMPUTATIONAL 1. Pine Corp.'s books showed pretax income of P800,000 for the year ended December 31, 20x1. In the computation of federal income taxes, the, following data were considered: Gain on an involuntary conversion (expropriation) Depreciation deducted for tax purposes in excess of depreciation deducted for book Estimated tax payments during 20x1 Le in 350,000 in purposes 50,000 70,000 Income tax rate 30% What amount should Pine report as its current income tax liability on its December 31, 20x1, balance sheet? a. 50,000 b. 65,000 с. 120,000 d. 135,000 (AICPA)
- Zeff Company prepared the following reconciliation for the · first year of operations: 1,600,000 Pretax financial income Nontaxable interest received Long-term loss accrual in excess of deductible amount Depreciation in excess of financial depreciation ( 50,000) 100,000 ( 250,000) 1,400,000 Taxable income (Tax rate is 30%) What amount should be reported as total income tax expense? a. 495,000 b. 480,000 c. 465,000 d. 420,000 What amount should be reported as deferred tax liability a. 90,000 b. 45,000 с. 75,000 d. 30,000 What amount should be reported as deferred tax asset? a. 30,000 b. 90,000 c. 45,000 d. 75,000The following income statement does not reflect Intraperlod tax allocation. Sales revenue Cost of goods sold Gross profit INCOME STATEMENT For the Fiscal Year Ended March 31, 2021 ($ in millions) Operating expenses Income tax expense Income before discontinued operations Loss from discontinued operations Net income Gross profit (loss) The company's tax rate is 25%. Required: Recast the income statement to reflect Intraperlod tax allocation. (Loss amounts should be indicated with a minus sign. Enter your answers in millions (l.e., 5,500,000 should be entered as 5.5).) Income Statement For the fiscal year ended March 31, 2021 Operating expenses Income from continuing operations before income taxes Net income (loss) Income before discontinued operations $ 874 (434) 440 (208) (23) 289 (140) $ 69 ($ in millions)Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.) Sales $ 663,800 Costs 425,700 Depreciation 101,300 ЕBIT Тахes (21%) Net income b. Calculate the OCF. (Do not round intermediate calculations.) c. What is the depreciation tax shield? (Do not round intermediate calculations.) b. OCF с. Depreciation tax shield