Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return: Taxable income P 4,000,000 Non-deductible expenses 200,000 Non-taxable revenue 300,000 Deferred income on installment sale included in financial income but taxable in 2022 450,000 Doubtful accounts recorded 100,000 Financial depreciation 300,000 Tax depreciation 350,000 Estimated warranty cost accrued in 2021 but not deductible for tax purposes until paid 100,000 Income tax rate 30% a. Determine the deferred tax expense or benefit of Xavier Company. b. Determine the total income tax expense of Xavier Company
Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return: Taxable income P 4,000,000 Non-deductible expenses 200,000 Non-taxable revenue 300,000 Deferred income on installment sale included in financial income but taxable in 2022 450,000 Doubtful accounts recorded 100,000 Financial depreciation 300,000 Tax depreciation 350,000 Estimated warranty cost accrued in 2021 but not deductible for tax purposes until paid 100,000 Income tax rate 30% a. Determine the deferred tax expense or benefit of Xavier Company. b. Determine the total income tax expense of Xavier Company
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 4E: Single Temporary Difference: Multiple Rates At the end of 2019, Fulhage Company reported taxable...
Related questions
Question
PROBLEM 1
Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return:
Taxable income P 4,000,000
Non-deductible expenses 200,000
Non-taxable revenue 300,000
Deferred income on installment sale
included in financial income but taxable
in 2022 450,000
Doubtful accounts recorded 100,000
Financialdepreciation 300,000
Tax depreciation 350,000
Estimated warranty cost accrued in
2021 but not deductible for tax
purposes until paid 100,000
Income tax rate 30%
Taxable income P 4,000,000
Non-deductible expenses 200,000
Non-taxable revenue 300,000
Deferred income on installment sale
included in financial income but taxable
in 2022 450,000
Doubtful accounts recorded 100,000
Financial
Tax depreciation 350,000
Estimated warranty cost accrued in
2021 but not deductible for tax
purposes until paid 100,000
Income tax rate 30%
a. Determine the deferred tax expense or benefit of Xavier Company.
b. Determine the total income tax expense of Xavier Company.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning