The Chief Financial Officer of ABC Company has presented the following information in line with the 2020 audit of ABC's financial statements: Pre-tax financial income: P9,700,000 Interest income on tax-exempt municipal bonds: 300,000 Depreciation claimed on the tax return in excess of financial depreciation: 500,000 Warranty expense reported in the income statement: 200,000 Actual warranty costs paid: 50,000 Income tax rate is 30%. At the beginning of the current year, the entity reported a deferred tax asset is zero and the deferred tax liability at P90,000. How much is the total tax expense for the current vear? *

The Chief Financial Officer of ABC Company has presented the following information in line with the 2020 audit of ABC's financial statements: Pre-tax financial income: P9,700,000 Interest income on tax-exempt municipal bonds: 300,000 Depreciation claimed on the tax return in excess of financial depreciation: 500,000 Warranty expense reported in the income statement: 200,000 Actual warranty costs paid: 50,000 Income tax rate is 30%. At the beginning of the current year, the entity reported a deferred tax asset is zero and the deferred tax liability at P90,000. How much is the total tax expense for the current vear? *

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

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 3RE: In the current year, Madison Corporation had 50,000 of taxable income at a tax rate of 25%. During...

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Grevilla Corporation is a manufacturing company. The corporation has accumulated earnings of $950,000, and it can establish reasonable needs for $400,000 of that amount. Calculate the amount of the accumulated earnings tax (if any) that Grevilla Corporation is subject to for this year. $_____________
Rhodes Corporations financial statements are shown after part f. Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions. a. What is the net operating profit after taxes (NOPAT) for 2020? b. What are the amounts of net operating working capital for both years? c. What are the amounts of total net operating capital for both years? d. What is the free cash flow for 2020? e. What is the ROIC for 2020? f. How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
In the current year, Madison Corporation had 50,000 of taxable income at a tax rate of 25%. During the year, Madison began offering warranties on its products and has a Warranty liability for financial reporting purposes of 5,000 at the end of the year. Warranty expenses are not deductible until paid for income tax purposes. Prepare the journal entry to record Madisons income taxes at the end of the year.
Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and taxable income for 2020. The prior period adjustment was the result of an error in calculating bad debt expense for 2019. The current tax rate is 30%, and no change in the tax rate has been enacted for future years. When the company applies intraperiod income tax allocation, the prior period adjustment will be shown on the: a. income statement at 12,000 b. income statement at 8,400 (net of 3,600 income taxes) c. retained earnings statement at 12,000 d. retained earnings statement at 8,400 (net of 3,600 income taxes)
he Chief Financial Officer of ABC Company has presented the following information in line with the 2020 audit of ABC’s financial statements:· Pre-tax financial income: P9,700,000· Interest income on tax-exempt municipal bonds: 300,000· Depreciation claimed on the tax return in excess of financial depreciation: 500,000· Warranty expense reported in the income statement: 200,000· Actual warranty costs paid: 50,000Income tax rate is 30%. At the beginning of the current year, the entity reported a deferred tax asset is zero and the deferred tax liability at P90,000. How much is the total tax expense for the current year? P 2,550,000 P 2,820,000 P 2,730,000 P 2,700,000
The following information was taken from the accounting records of Lancer Inc, for the year ending 2020. Pretax accounting income $ 1,500,000 Interest Revenue on Municipal bonds 100,000 Litigation expense 2, 000,000 Excess Depreciation for tax purposes 1, 300,000 Deferred revenue 200,000 The tax rate for 2020 is 40% The total taxable income computed by Lancer for 2020 should be : A) $2,300,000 B) $4.900,000 C) $ 900,000 D) $3,700,000
The following information was taken from the accounting records of Lancer Inc, for the year ending 2020. Pretax accounting income $ 1,500,000 Interest Revenue on Municipal bonds 100,000 Litigation expense 2, 000,000 Excess Depreciation for tax purposes 1, 300,000 Deferred revenue 200,000 The tax rate for 2020 is 40% The total Deferred Tax Asset for 2020 should be : A) $4,000 B) $800,000 C) $520,000 D) $80,000
The following information was taken from the accounting records of Lancer Inc, for the year ending 2020. Pretax accounting income $ 1,500,000 Interest Revenue on Municipal bonds 100,000 Litigation expense 2, 000,000 Excess Depreciation for tax purposes 1, 300,000 Deferred revenue 200,000 The tax rate for 2020 is 40% The total Deferred Tax Asset for 2020 should be :