Q: Compare and contrast how GAAP depreciation expense vs. MACRS depreciation deductions are computed.
A: GAAP : Generally Accepted Accounting principles. MACRS: Modified Accelerated Cost Recovery System.
Q: Describe the Depreciation methods for Book and Tax Depreciation?
A: Meaning of Depreciation Depreciation is an indirect expense allocated to the fixed assets showing…
Q: Depreciation Inflation Taxation
A: Definition of each of these financial terms along with an example each are provided below:
Q: How to calculate the indexed cost base for capital gains tax
A: SOLUTION- CAPITAL GAIN TAX- IT IS A TYPE OF TAX APPLIED TO THE PROFITS EARNED ON THE SALE OF AN…
Q: Explain how the depreciation method selected affects the balance sheet and income statement
A: Depreciation is the loss in the value of the asset caused due to its usage, wear, and tear. There…
Q: The salvage value and book value is divided into two parts for tax purposes. Explain how along with…
A: Book Value: It is referred to as that value of an asset which is recorded in the books of accounts…
Q: From the following identify the cost that is not a cost of PPE? Professional fees Nonrefundable…
A: Property plant and machinery are the fixed assets of the company which helps in production process.…
Q: Compare and contrast how book (GAAP) depreciation expense vs. MACRS depreciation deductions are…
A: GAAP : Generally Accepted Accounting principles MACRS: Modified Accelerated Cost Recovery System.
Q: Using the straight-line method of depreciation for reporting purposes and accelerateddepreciation…
A: To offset the amount of a deferred tax asset , valuation allowance is used. A deferred tax asset is…
Q: Present a mathematical solution in order to express that how depreciation can effect tax liability…
A: There are different types of Depreciation method. They are: 1) Straight Line Method 2) Declining…
Q: Describe the depreciation procedures used in income taxation
A: The question deals with the depreciation procedures used in income taxation.
Q: After tax cost of interest deals with the fact that interest is deductible for tax purposes.…
A: Interest expenses are the expenses which are related to borrowings raised by the company. The…
Q: Please in calculating return on year end capital employed = profit before tax / capital employed.…
A: Return on capital employed (ROCE): It is the type of profitability ratio that tells how well the…
Q: What is the relationship between depreciation and net income?
A: Depreciation is the part of cost of a asset which is charged to income statement yearly as a expense…
Q: EBITDA can be calculated using following formula depreciation = EBITDA + ЕBIT ammortisation EAT…
A: EBITDA means earning before interest , tax , depreciation and amortization.
Q: The value of property for tax purposes, usually a percentage of the fair market value is known as…
A: Appraisal value refers to that on a specific date, the specific property’s current market value is…
Q: Discuss the Depreciation method for tax purposes?
A: Depreciation: Depreciation refers to the reduction in the monetary value of a fixed asset due to…
Q: Compute Larkspur's weighted-average accumulated expenditures for interest capitalization purposes.
A: To calculate weighted average accumulated expenditure, we need to take out the product of…
Q: The tax rate that is applied against a prepayment penalty is the Group of answer choices 1)…
A: On the basis of a slab scheme, the Indian income tax levies tax on individual taxpayers. The slab…
Q: Describe Tax Depreciation Methods?
A: Depreciation is a non-cash expense for the company. The depreciation expenses is charged because the…
Q: Depreciation can be defined as the measure of cost or revalued amount of economic benefits of a…
A: Depreciation can also be defined as: It records the usage of a fixed asset over a period of time and…
Q: Describe the techniques of depreciation available to individuals under the income tax code.
A: Tax depreciation alludes to a company's depreciation costs that are deductible by the IRS. This…
Q: Please discuss the deductibility of real property taxes.
A: Local governments and municipal corporations collect property taxes annually from landowners.
Q: appropriate data into the tax-accounting program. What are the values of B, n, and S in depreciating…
A: B = Purchase price + Transportation cost + Installation cost S = 10% of purchase price n =…
Q: What is the real return? Multiple Choice The after-tax return on assets. The pre-tax return…
A: Rate of return is the percentage of profit that is earned on an investment.
Q: Which of the following is used when computing for the accounting rate of return (ARR)? a. Income…
A: The accounting rate of return is the average net income an asset is expected to generate on the…
Q: What is a Capital Gain Tax (CGT) Asset? Give at least one example for each of the three types of…
A: Capital gain tax asset is an asset which when sold, the gain will attract capital gain tax. As per…
Q: Capital expenditures are ______ on the proforma but are ________ for income tax purposes. Group of…
A: Capital expenditures: Capital expenditures are funds utilized by a corporation to obtain, develop,…
Q: The MACRS depreciation system is used for tax purposes, and the straight-line depreciation method is…
A: Deferred tax liability: Deferred tax liability arises when taxes paid under accounting records are…
Q: Using tax depreciation for tax purposes and straight-line depreciation for financial reporting, do…
A: Deferred tax liability is the amount of tax that is due for the period but not been paid. It arises…
Q: Explain what is meant by an accelerated depreciationmethod. Are accelerated methods more widely used…
A: The term accelerated depreciation implies that in the early years of the existence of the asset,…
Q: Illustrate the significance of depreciation and income taxes?
A: Depreciation is the charge against the usage, wear and tear or obsolescence of the asset in the…
Q: There are four ways tax consequences may affect the after-tax net proceeds received from the sales…
A: Sale of asset happen when the firm sells all of its assets whether intangible or tangible. In the…
Q: When an entity adjusted the historical cost income statement by applying specific price index to…
A: This question is answered as per Inflation accounting.
Q: Define each of the following terms: i. Capital gain or loss; tax loss carryback and carryforward
A: The capital gain or loss is computed as the difference in the sale price and purchase price of an…
Q: Calculate the assessed value (in $) and the property tax due (in $) on the property. (Round your…
A: Assessed value = Fair market value * Assessment rate Property tax due =Assessed value * Property…
Q: Describe the method of Accounting for Depreciation and Income Taxes?
A: Generally Accepted Accounting Principles (GAAP): Generally Accepted Accounting Principles are the…
Q: How does the tax depreciation methods generally permit a higher depreciation than the book…
A: Book Depreciation: Book Depreciation means the amortization expense amount which are recorded in…
Q: What is the proper term for depreciation methods used for tax purposes? Provide the acronym and the…
A: Proper Term Used for depreciation for Tax Purpose: The term used for Depreciation is MACRS Full…
Step by step
Solved in 3 steps with 2 images
- Orbit Limited : Statement of Financial Position as at 31 December 2022 2021 Non-current Assets R11 810 000 R7 560 000 Property, Plant, Equipment R10 025 000 R6 250 000 Investments R1 785 000 R1 310 000 Current Assets R4 190 000 R4 690 000 Inventories R 1 875 000 R2 350 000 Account Receivable R1 925 000 R2 200 000 Cash R390 000 R140 000 Toatal Assets R16 000 000 R12 250 000 Equities & Liabilities Equity ? ? Oridanary share capital R5 480 000 R3 680 000 Retained earnings ? ? Non-current Liabilities R4 500 000 R3 800 000 Loan (20% p.a) R4 500 000 R3 800 000 Current Liabilities R2 300 000 R1 500 000 Accounts payable? R2 300 000 R1 500 000 Calculate the increase in the retained earnings over the two-year period.Use the below information to answer the following questions: 20202021Sales$11,573$12,936Depreciation 1661 1736Cost of goods sold 3979 4707Other Expenses 846 924Interest Expense 776 926Cash 6067 6466Accounts Receivables 8034 9427Short-term Notes Payable 1171 1147Long-term debt 20,320 24,696Net fixed assets 50,888 54,273Accounts Payable 4384 4644Tax rate 26% 34%Inventory 14,283 15,288Payout ratio 33% 30% A. Create the Balance Sheets for 2020 & 2021.Use the below information to answer the following questions: 20202021Sales$11,573$12,936Depreciation 1661 1736Cost of goods sold 3979 4707Other Expenses 846 924Interest Expense 776 926Cash 6067 6466Accounts Receivables 8034 9427Short-term Notes Payable 1171 1147Long-term debt 20,320 24,696Net fixed assets 50,888 54,273Accounts Payable 4384 4644Tax rate 26% 34%Inventory 14,283 15,288Payout ratio 33% 30% A. Create the Income Statements for 2020 and 2021 (including dividends paid and retained earnings).
- Description FY10 FY11 FY12 FY13 FY14 Financial Statements GBP m GBP m GBP m GBP m GBP m Income Statements Revenue 4,390 3,624 3,717 8,167 11,366 Profit before interest & taxes (EBIT) 844 700 704 933 1,579 Net Interest Payable (80) (54) (98) (163) (188) Taxation (186) (195) (208) (349) (579) Miniorities (94) (99) (105) (125) (167) Profit for the year 484 352 293 296 645 Balance Sheet Fixed Assets 3,510 3,667 4,758 10,431 11,483…INCOME STATEMENT Year ended June 30 2022 2021 $'000 $'000Revenue 22450 18675Cost of sales 8475 8055Gross Profit 13975 10620Distribution costs 4245 3120Administrative expenses 1276 2134Selling expenses…Samuel Corp. provides the following information: EBIT = $386.50 Tax (TC ) = 21% Debt = $700 RU = 10% Question: What is the value of Samuel’s equity?
- A2 aii Use the following information for Delta Corporation: Year 20X1 20X2 Net sales $1,500,000 $1,656,598 Cost of goods sold 675,000 745,469 Depreciation 270,000 298,188 Interest paid 43,600 44,000 Cash 127,500 140,811 Account’s receivable 450,000 496,980 Inventory 525,000 579,809 Net fixed assets 1,800,000 1,987,918 Accounts payable 375,000 414,150 Notes payable 45,000 50,000 Long-term debt 500,000 500,000 Common stock 1,000,000 1,000,000 Retained earnings 982,500 1,241,368 Tax rate 35% 35% Dividend payout 30% 30% Delta has 600,000 common shares outstanding. The firm is projecting a 20% increase in net sales for the coming year (20X3). Delta uses the percentage of sales approach to plan for its financing needs. In using this approach, the firm assumes that cost of goods sold, all assets (current and fixed), and accounts payable will all remain a constant…Use the following information (in thousands):a. ¥126,000 d. ¥63,000Answer:1Sales revenue¥300,000 Gain on sale of equipment90,000 Cost of goods sold164,000 Interest expense16,000 Selling & administrative expenses30,000 Income tax rate30%Determine the amount of net income.E23.10B (L0 1,4) (Classification of Transactions) Following are selected balance sheet accounts of BioLazer Corp. at December 31, 2020 and 2019, and the increases or decreases in each account from 2019 to 2020. Also presented is selected income statement information for the year ended December 31, 2020, and additional information. Increase Selected balance sheet accounts 2020 2019 (Decrease)AssetsAccounts receivable $154,000 $120,000 $34,000Property, plant, and equipment 631,000 581,000 50,000Accumulated…
- 1-What will be the net income? a. 72000 b. 56000 c. 16000 d. 338000 Clear my choice Question 43 Not yet answered Marked out of 1.00 Flag question Question text What will be the Gross Profit at the end of the year December 2019 a. OMR 56000 b. OMR 16000 c. OMR 338,000 d. OMR 336,000 2-What is the Gross Margin in terms of Percentage? a. 16.66 b. 16.56 c. Cannot be determined d. 20.66 3-What will be the total operating expense? a. 21500 b. 53200 c. 41200 d. 19700 4-What will be the total Selling and distribution expense? a. 41200 b. 19700 c. 14800 d. 17200Nairobi Ltd Trial Balance As at 31st December 2020 Dr. Cr. Kshs'000 Kshs'000 Sales 500 Furniture-at cost 35 Salaries 80 Buildings-at Cost 100 Accounts Receivable 120 Cash and Cash Equivalent 443 Machinery-at Cost 122 Accounts Payable 105 Salaries Payable 42 Long-term Loans 100 Ordinary Share Capital 150 Stock(Inventories) on 31.12.2020 94 Retained Earnings 157 Cost of Sales 60 1,054 1,054 Additional information (i) Machinery is to be depreciated at 10% p.a.…Financials of B Ltd are as follows. 10% Debt 6500; Tax 35%. Find cost of Debt. a. 5.60% b. 6.50% c. 7.50% d. 5.70%
