san Luong Corporation, a calendar year, accrual basis corporation, reported $1.65 million of net income after tax on its financial statementsprepared in accordance with GAAP. The corporation's books and records reveal the following information:• Luong's federal income tax expense per books was $213,000.• Luong's book income included $23,000 of dividends received from a domestic corporation in which Luong owns a 25 percentstock interest, and $10,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest.• Luong recognized $23,000 of capital losses this year and no capital gains.• Luong recorded $14,600 of book expense for meals not provided by a restaurant and $16,500 of book expense for entertainmentcosts.• Luong's depreciation expense for book purposes totaled $413,000. MACRS depreciation was $475,000.Required:a. Compute Luong's federal taxable income and regular tax liability.b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income.Complete this question by entering your answers in the tabs below.Required A Required BCompute Luong's federal taxable income and regular tax liability.Note: Enter your answers in whole dollars not in millions.Taxable incomeTax liabilityAmount

A US corporation generally may deduct 50% of dividends received from other US corporations in…

Answered: Luong Corporation, a

Business

Accounting

Luong Corporation, a

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 5BCRQ

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Luong Corporation, a calendar year, accrual basis corporation, reported $1.65 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: • Luong's federal income tax expense per books was $213,000. • Luong's book income included $23,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $10,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. • Luong recognized $23,000 of capital losses this year and no capital gains. • Luong recorded $14,600 of book expense for meals not provided by a restaurant and $16,500 of book expense for entertainment costs. • Luong's depreciation expense for book purposes totaled $413,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's…
Luong Corporation, a calendar year, accrual basis corporation, reported $1.15 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: • Luong's federal income tax expense per books was $203,000. • Luong's book income included $13,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $5,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $13,000 of capital losses this year and no capital gains. • Luong recorded $9,600 of book expense for meals not provided by a restaurant and $11,500 of book expense for entertainment costs. • Luong's depreciation expense for book purposes totaled $403,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book…
uong Corporation, a calendar year, accrual basis corporation, reported $1 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation’s books and records reveal the following information: Luong’s federal income tax expense per books was $200,000. Luong’s book income included $10,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $4,000 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $10,000 of capital losses this year and no capital gains. Luong recorded $8,000 of book expense for meals not provided by a restaurant and $10,000 of book expense for entertainment costs. Luong's depreciation expense for book purposes totaled $400,000. MACRS depreciation was $475,000. Required: Compute Luong's federal taxable income and regular tax liability.
Gosling, Inc., a calendar year, accrual basis corporation, reported $756,000 net income after tax on its financial statements prepared in accordance with GAAP. The corporation's financial records reveal the following information: Gosling earned $3,500 on an investment in tax-exempt municipal bonds. Gosling received an advance payment of rent this year for $25,000. This amount was not included in book income. Gosling's depreciation expense per books was $72,000, and its MACRS depreciation deduction was $105,000. Gosling recorded $58,000 of business meals and $27,000 of entertainment expense for book purposes. Gosling's federal income tax expense per books was $220,000. a. Compute Gosling's taxable income and regular tax liability. b. Prepare a Schedule M-1, page 5, Form 1120, reconciling Gosling's book and taxable income.
Cramer Corporation, a calendar year, accrual basis corporation, reported $1.90 million of net income after tax on its 2020 financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: Cramer's federal income tax expense per books was $218,000. Cramer's book income included $28,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $13,000 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest. Cramer recognized $28,000 of capital losses this year and no capital gains. Cramer recorded $17,000 of book expense for meals and $19,000 of book expense for entertainment costs. Cramer's depreciation expense for book purposes totaled $418,000. MACRS depreciation was $475,000. Required: Compute Cramer's federal taxable income and regular tax liability. Prepare a Schedule M-1, page 6, Form 1120, reconciling Cramer's book and taxable income.
Cramer Corporation, a calendar year, accrual basis corporation, reported $1.25 million of net income after tax on its 2020 financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: . . Cramer's federal income tax expense per books was $205,000. Cramer's book income included $15,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $6,500 of dividends from a domestic corporation in which Cramer owns a 5 percent stock interest. Cramer recognized $15,000 of capital losses this year and no capital gains. . . Cramer recorded $10,600 of book expense for meals and $12.500 of book expense for entertainment costs. . Cramer's depreciation expense for book purposes totaled $405,000. MACRS depreciation was $475,000. Required: a. Compute Cramer's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Cramer's book and taxable…
Western Corporation, a calendar year, accrual basis corporation, reported $500,000 of net income after tax on its financial statements prepared in accordance with GAAP. The corporation’s books and records reveal the following information: Western’s book income included $15,000 of dividends, received from a domestic corporation in which Western owns less than 1 percent of the outstanding stock. Western’s depreciation expense per books was $55,000, and its MACRS depreciation was $70,000. Western earned $5,000 of interest from municipal bonds and $6,000 of interest from corporate bonds. Western’s capital losses exceeded its capital gains by $2,000. Western’s federal income tax expense per books was $103,000. Compute Western’s federal taxable income and regular tax liability. My Solutions: federal taxable income = $585,500, regular tax liability = $122,955 (This is a past homework problem that I got wrong. Could you please explain how to do this, I do not understand what I did…
Western Corporation, a calendar year, accrual basis corporation, reported $500,000 of net income after tax on its financial statements prepared in accordance with GAAP. The corporation’s books and records reveal the following information: Western’s book income included $15,000 of dividends, received from a domestic corporation in which Western owns less than 1 percent of the outstanding stock. Western’s depreciation expense per books was $55,000, and its MACRS depreciation was $70,000. Western earned $5,000 of interest from municipal bonds and $6,000 of interest from corporate bonds. Western’s capital losses exceeded its capital gains by $2,000. Western’s federal income tax expense per books was $103,000. Required: Compute Western’s federal taxable income and regular tax liability. Prepare a Schedule M-1, page 6, Form 1120, reconciling Western’s book and taxable income.
EFG, a calendar year, accrual basis corporation, reported $479,900 net income after tax on its financial statements prepared in accordance with GAAP. The corporation’s financial records reveal the following information: EFG earned $10,700 on an investment in tax-exempt municipal bonds. EFG’s allowance for bad debts as of January 1 was $21,000. Write-offs for the year totaled $4,400, while the addition to the allowance was $3,700. The allowance as of December 31 was $20,300. On August 7, EFG paid a $6,000 fine to a municipal government for a violation of a local zoning ordinance. EFG’s depreciation expense per books was $44,200, and its MACRS depreciation deduction was $31,000. This is EFG’s second taxable year. In its first taxable year, it recognized an $8,800 net capital loss. This year, it recognized a $31,000 Section 1231 gain on the sale of equipment. This was EFG’s only disposition of noninventory assets. In its first taxable year, EFG capitalized $6,900 organizational costs…
The ABC Corporation has net income reported on its books of $120, 500. For the current year, the corporation had federal income tax expense of $30,000, a net capital loss of $ 8,300, and tax-exempt interest income of $5,300. The company deducted depreciation of $20,000 on its tax return and $15,000 on its books. Calculate the ABC Corporation's taxable income.
The profit and loss statement of Treadwell Ltd., an S corporation, shows $265,000 book income. Treadwell is owned equally by four shareholders. From supplemental data, you obtain the following information about items that are included in book income. (attached image) a. Compute Treadwell's nonseparately stated income or loss for the tax year. b. What would be the share of this year's nonseparately stated income or loss items for Leo Lion, one of the Treadwell shareholders? c. What is Leo Lion's share of tax-exempt interest income, if any?
XYZ is a calendar-year corporation that began business on January 1, 2021. For the year, it reported the following information in its current-year audited income statement. Notes with important tax information are provided below. Use Exhibit 16-6. (See image attached) XYZ owns 30% of the outstanding Hobble Corporation (HC) stock. Hobble Corporation reported $1,000,000 of income for the year. XYZ accounted for its investment in HC under the equity method, and it recorded its pro rata share of HC’s earnings for the year. HC also distributed a $200,000 dividend to XYZ. For tax purposes, HC reports the actual dividend received as income, not the pro rata share of HC’s earnings. Of the $20,000 interest income, $5,000 was from a City of Seattle bond, $7,000 was from a Tacoma City bond, $6,000 was from a fully taxable corporate bond, and the remaining $2,000 was from a money market account. This gain is from equipment that XYZ purchased in February and sold in December (i.e., it does not…