The records for AC3220 Ltd. show the following data for calendar 2023: 1. Golf club dues were $3,800. 2. 4. Machinery was acquired in January 2023 for $300,000. AC3220 uses straight-line depreciation over a ten-year life (no residual value). For tax purposes, AC3220 claimed 42,000 of CCA on the equipment for 2023. Total meals and accommodations expensed for the year was 8,000. 5. The estimated warranty liability related to 2023 sales was $19,600. Warranty repair costs paid during 2023 were $13,600. The remainder will be paid in 2024. 6. Pre-tax accounting income is $250,000. The enacted income tax rate is 25%. Instructions a) Prepare a schedule (starting with pre-tax accounting income) to calculate taxable income. b) Prepare the required adjusting entries to record income taxes for 2023.
The records for AC3220 Ltd. show the following data for calendar 2023: 1. Golf club dues were $3,800. 2. 4. Machinery was acquired in January 2023 for $300,000. AC3220 uses straight-line depreciation over a ten-year life (no residual value). For tax purposes, AC3220 claimed 42,000 of CCA on the equipment for 2023. Total meals and accommodations expensed for the year was 8,000. 5. The estimated warranty liability related to 2023 sales was $19,600. Warranty repair costs paid during 2023 were $13,600. The remainder will be paid in 2024. 6. Pre-tax accounting income is $250,000. The enacted income tax rate is 25%. Instructions a) Prepare a schedule (starting with pre-tax accounting income) to calculate taxable income. b) Prepare the required adjusting entries to record income taxes for 2023.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter11: Depreciation, Depletion, Impairment, And Disposal
Section: Chapter Questions
Problem 14P: Hunter Company purchased a light truck on January 2, 2019 for 18,000. The truck, which will be used...
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