Buffalo Wings Company reports taxable income of P1,658,000 on its income tax return for the year ended December 31, 2020. Temporary differences between financial income and taxable income for the year are: • Book depreciation in excess of tax depreciation, P160,000 • Accrual of product warranty claims in excess of actual claims, P250,000 • Reported installment sales revenue, P530,000 What is Buffalo Wings Company’s financial income subject to tax for the year ended December 31, 2020?

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Q: For the year ended December 31, 2021, Irene Company reported pretax accounting income of P6,000,000.…

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Q: The following information is taken from Brilliant Company’s 2020 financial records: Pretax…

A: Solution: Deferred tax asset = Excess accrued warranty * tax rate of 2021  = 24500*32%  = 7,840

Q: pretax accounting income

A: Pretax accounting income = Taxable income + Accumulated depreciation for tax purpose - Accumulated…

Q: Integrity Company computed a pre-tax financial income of P2,200,000 for its first year of operations…

A: According to the given question, we are required to compute the total income tax expense in 2021.…

Q: Sweet and Sour Company had pretax accounting income of P2,400,000 during 2020. Sweet and Sour…

A: Solution Given Pre tax accounting income of 2020 2,400,000 Sales made in 2019 recorded in…

Q: Scarlet Company had pretax accounting income of P2,400,000 during 2020. Scarlet Company’s temporary…

A: Solution Given Pre tax accounting income of 2020 2,400,000 Sales made in 2019 recorded in…

Q: For the year 2020, Tonkatsu Company reported income tax expense of P110,000. Income tax payable at…

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A: In Balance Sheet  Deferred tax asset 2022 = Deferred tax asset 2020 + Deferred tax asset 2021 +…

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A: A journal entry is a form of accounting entry that is used to report a business transaction in a…

Q: Zurich Company reports pretax financial income of $70,000 for 2020. The following items cause…

A: a. Compute taxable income and income taxes payable for 2020.Taxable income = Pretax financial income…

Q: The following taxable income data is available for ACME Incorporated: Year Taxable Income Tax Rate…

A: Income statement- The Income Statement is one of a company’s heart fiscal statements that…

Q: The books of Chicharon Bulaklak Company for the year ended December 31, 2020 showed pretax income of…

A: Taxable income = pretax income - excess of depreciation + excess of income  = 720000-32000+24000 =…

Q: BC Corporation computed a pretax financial income of $6,000,000 for the year ended December 31,…

A: solution  given The tax rate for year 2019 = 32% we need to use the current tax rate for determining…

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A: Income tax expense (benefit) for the year 2019 =  Pretax financial income x Income tax rate

Q: On December 31, 2020, Landmark Company reported the following: Income before tax for accounting…

A: The following computations are done in the records of the Landmark Company.

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A: Deferred tax liability = cumulative temporary difference x tax rate -  balance in the Deferred Tax…

Q: Shirmp Tempura Company reported an excess of warranty expense over warranty deductions of P720,000…

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A: Comment-Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the…

Q: At 30 June 2019, ABC Ltd had the following deferred tax balances: Deferred tax liability $18,000…

A: Deferred Tax Liability: The amount of tax that a company has paid less than that of the actual tax.…

Q: Buffalo Wings Company reports taxable income of P1,658,000 on its income tax return for the year…

A: Solution: Financial income subject to tax = taxable income - Excess book depreciation - Accrual of…

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Q: A company made $49,000 in installment sales in 2021 and will receive payment from customers in…

A: Pretax accounting income = Taxable income + Installment sales = $472,000 + $49,000 = $521,000

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A: Lets understand the basics. When there is temporary taxable differencce arise between the taxable…

Q: J-Matt, Inc., had pretax accounting income of $291,000 and taxable income of $300,000 in 2018. The…

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Q: Bestlook Company provided the following information for its first year of operati December 31, 2019…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: At December 31, 2020, Novak Company had a net deferred tax liability of $445,000. An explanation of…

A: Note: Net deferred tax liability of $445,000 is shown under the Non-Current liabilities.

Q: Omskirt Company reported an excess of warranty expense over warranty deductions of P720,000 for the…

A: The company has to create a deferred tax asset amounting to P216000 on P7,20,000 at the rate of…

Q: The following information is taken from Igado Company’s 2020 financial records: Pretax accounting…

A: Deferred tax asset = Accrued warranty in excess of actual warranty expenditures X Tax rate for 2021)…

Q: On December 31, 2020, Landmark Company reported the following: Income before tax for accounting…

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Q: KAY Co. reported net income for the current year 2021 at P4,180,000 before taxes. Included in the…

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Q: s pretax financial income of $68,400 for 2020. The following items cause taxable income to be…

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Q: Acer, Inc. reported a taxable income of P8,000,000 in its Form 1702 for its first year of…

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Q: Clydesdale Corporation has a cumulative temporary difference related to depreciation of $580,000 at…

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Q: The books of Chicago Company for the year ended December 31, 2020 showed pretax income of P720,000.…

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Q: osh Company reports pretax financial income of P700,000 for 2020. The following caused taxable…

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A: Compute taxable income and income taxes payable for 2020.

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Q: For the year 2020, Tonkatsu Company reported income tax expense of P110,000. Income tax payable at…

A: Income tax liability for 2020 = income tax expense - ending deferred tax liability + beginning…

Q: At 30 June 2019, Beta Ltd had the following deferred tax balances:Deferred tax liability $18,000…

A: Deferred tax can be a notional asset or liability to think about corporate pay tax assessment a…

Q: The following information is taken from Brilliant Company’s 2020 financial records: Pretax…

A: Deferred tax assets (P24500 * 32%) = P7,840

Q: Sweet and Sour Company had pretax accounting income of P2,400,000 during 2020. Sweet and Sour…

A: Solution Given Pre tax accounting income of 2020 2,400,000 Sales made in 2019 recorded in…

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.