Concept explainers
Identify future taxable amounts and future deductible amounts
• LO16–1, LO16–2
(This is a variation of E 16–6, modified to focus on the balance sheet accounts related to the
Temporary Difference
_______ 1. Accrual of loss contingency; tax-deductible when paid
_______ 2. Newspaper subscriptions; taxable when received, recognized for financial reporting when the performance obligation is satisfied
_______ 3. Prepaid rent; tax-deductible when paid
_______ 4. Accrued bond interest expense; tax-deductible when paid
_______ 5. Prepaid insurance; tax-deductible when paid
_______ 6. Unrealized loss from recording investments at fair value; tax-deductible when investments are sold
_______ 7. Warranty expense; estimated for financial reporting when products are sold; deducted for tax purposes when paid
_______ 8. Advance rent receipts on an operating lease as the lessor; taxable when received
_______ 9. Straight-line
_______ 10. Accrued expense for employee postretirement benefits; tax-deductible when subsequent payments are made
Want to see the full answer?
Check out a sample textbook solutionChapter 16 Solutions
CONNECT F/ INTERMEDIATE ACCTING>I<
Additional Business Textbook Solutions
Horngren's Accounting (11th Edition)
Principles of Accounting Volume 2
Managerial Accounting (4th Edition)
Financial Accounting (11th Edition)
Principles of Accounting Volume 1
Cost Accounting (15th Edition)
- Ma3. Outline the differences between IRC Section 311 and 336/337 for non-liquidating and liquidating distributions. In your answers, include the consequences for the tax attributes (E&P, recapture, installment sales)arrow_forward2. S1: The excess of allowable deductions over gross sales is net operating loss. S2: Net operating loss is a deduction from gross income even if the taxpayer chose optional standard deduction. S3: If net operating loss is incurred in 2021, the taxpayer can carry over the loss in the immediately succeeding three (3) years Which is TRUE?arrow_forwardRead Section 1362: 2. What tax year is required?(review Section1378)arrow_forward
- Mf6. As per the latest tax update, the aggregate amt of distributions recvieved by an indivivdual,tat may be treated as "coronavirus-related distribution" for any taxable year,shall not exceed 100K, 250K, 50K, OR 80K?arrow_forwardAmount in excess of P490,000.00 taxable income is to be multiplied to_______to compute for the graduated tax due a. 30% b. 32% c. 35%arrow_forwardThe citation Reg 1.62.1 T indicates: a. that this is a final income tax regulation involving Code Section 162 b. that this is a temporary income tax regulation involving Code Sec. 62 c. that this is a temporary estate tax regulation involving Code Sec 62 d. None of the abovearrow_forward
- Rr.12. 1.) Calculate taxable income for 20X2 answer: 139,000 2.) Calculate taxes payable for 20X2 answer: 20,850 3.) Determine the current deferred tax liability at 12/31/X2 answer: 37200 4.) calculate total income tax expense for 20X2 answer: 58,050 5.) Compute net income after taxes for 20X2 answer: 328,950 6.) Calculate taxable income for 20X3 answer: 213,027 7.) The entry required at the end of 20X3 requires answer: debit DTL for 26,040 8.) Compute net income after taxes for 20X3 answer: ??? 9.) Calculate taxable income for 20X4 answer: 196,800 10.) Compute net income after taxes for 20X4 answer: ??? Using the information above, solve for parts 8 and 10arrow_forward1. What amount of permanent difference between book income and taxable income existed at year end?a. 520,000b. 360,000c. 800,000d. 280,0002. What amount of current tax expense should be reported? a. 786,000b. 510,000c. 750,000d. 678,0003. What amount of income tax payable should be reported?a. 498,000b. 606,000c. 330,000d. 570,0004. What amount of total tax expense should be reported?a. 714,000b. 726,000c. 642,000d. 594,000arrow_forward[8:50 PM, 2/23/2022] Veron Walker Uwi: Grace Corporation's pretax financial income is $600,000 and taxable income is $550,000 for year 2020.Its beginning deferred tax liability account has a balance of $75,000. Its cumulative temporarydifferences for year-end 2020 is equal to $300,000 and will reverse and result in taxable amounts as follows: Year Taxable Amount2021 $100,0002022 $ 75,0002023 $125,000The tax rate is 30% for all years.[8:50 PM, 2/23/2022] Veron Walker Uwi: Required:(i) Calculate the taxes payable for the year 2020(ii) Calculate the deferred tax liability for the year 2020(iii) Calculate the total tax expense for 2020(iv) Prepare the journal entry to record the tax expense for 2020(v) Prepare the income statement presentation of the tax amounarrow_forward
- 26. Which of the following differences would result in future taxable amounts? * a. Expenses and losses that are deductible after they are recognized in financial income. b. Revenues or gains that are taxable before they are recognized in financial income. c. Expenses or losses that are deductible before they are recognized in financial income. d. Revenues or gains that are recognized in financial income but are never included in taxable income.arrow_forward1. Deferred tax liability, January 1, 2022, $0. 2. Deferred tax asset, January 1, 2022, $0. 3. Pretax financial income for 2022, $345,000. 4. Cumulative temporary difference at December 31, 2022, giving rise to future taxable amounts, $205,500. 5. Cumulative temporary difference at December 31, 2022, giving rise to future deductible amounts, $64,800. 6. Tax rate for all years, 20%. 7. The company is expected to operate profitably in the future. Determine the income taxes payable for 2022.arrow_forwardIntermediate Accounting ll ch 16 7. At the end of 2023, Payne Industries had a deferred tax asset account with a balance of $25 million attributable to a temporary book-tax difference of $100 million in a liability for estimated expenses. At the end of 2024, the temporary difference is $64 million. Payne has no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for 2024 is $180 million and the tax rate is 25%. Required: Prepare the journal entry(s) to record Payne’s income taxes for 2024, assuming it is more likely than not that the deferred tax asset will be realized in full. Prepare the journal entry(s) to record Payne’s income taxes for 2024, assuming it is more likely than not that only one-fourth of the deferred tax asset ultimately will be realized. Required 1 Record 2024 income taxes Transaction General Journal Debit Credit 1 Record…arrow_forward
- Individual Income TaxesAccountingISBN:9780357109731Author:HoffmanPublisher:CENGAGE LEARNING - CONSIGNMENT