1.
Deferred tax account shows the amount of reconciliation, which occurs due to the difference between the income tax expense account and the income tax payable account.
When the Income Tax Expense account i.e. the estimated income tax amount is more than the outstanding amount of income tax i.e. the Income Tax Payable account, the difference is to be debited to Deferred Tax Asset account.
When the Income Tax Expense account i.e. the estimated income tax amount is less than the outstanding amount of income tax i.e. the Income Tax Payable account, the difference is to be credited to Deferred Tax Liability account.
To determine: The net deferred tax amount of AF at December 31, 2015.
2.
To explore: The consistency of policy with U.S. GAAP.
3.
To explore: The consistency of policy with U.S. GAAP.
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Chapter 16 Solutions
INTERMEDIATE ACCOUNTING RMU 9TH EDITION
- Balance Sheet Baggett Companys balance sheet accounts and amounts as of December 31, 2019, are shown in random order as follows: Required: 1. Prepare a December 31, 2019, balance sheet for Baggett. 2. Compute the debt to-assets ratio.arrow_forwardE9-5B: (Statement of Financial Position – Current vs Non- current Classification) KIWI Corporation is in the process of preparing its December 31, 2014, statement of financial position. There are some questions as to the proper classification of the following items: a. P 50,000 in cash set aside in a savings account to pay bonds payable. The bonds mature in 2018. b. Prepaid rent of P24,000, covering the period January 1, 2015, through December 31, 2016. e. Note payable of P200,000. The note is payable in annual installments of P20,000 each, with the first instalment payable on March 1, 2015. d. Accrued interest payable of P12,000 related to the note payable. Investment in trading securities of other corporations, P60,000. Cone intends to sell one-half of the securities in с. е. 2015. Instruction: Determine the current and non-current components of the above selected transactions using the table below. ASSETS LIABILITIES Current Non-current Current Non-current A 12000 50000 B 12000 C…arrow_forwardE9-5B: (Statement of Financial Position – Current vs Non-current Classification) KIWI Corporation is in the process of preparing its December 31, 2014, statement of financial position. There are some questions as to the proper classification of the following items: P 50,000 in cash set aside in a savings account to pay bonds payable. The bonds mature in 2018. b. Prepaid rent of P24,000, covering the period January 1, 2015, through December 31, 2016. c. Note payable of P200,000. The note is payable in annual installments of P20,000 each, with the first instalment payable on March 1, 2015. d. Accrued interest payable of P12,000 related to the note payable. e. Investment in trading securities of other corporations, P60,000. Cone intends to sell one-half of the a. securities in 2015. Instruction: Determine the current and non-current components of the above selected transactions using the table below. ASSETS LIABILITIES Current Non-current Current Non-current A В totalarrow_forward
- Calculating Ratios and Estimating Credit Rating The following data are from Kellogg's 10-K report dated December 29, 2018 ($ millions). Revenue Interest expense Tax expense Amortization expense Depreciation expense $13,547 Earnings from continuing operations $1,344 Capital expenditures (CAPEX) 578 287 181 Total debt 8,893 23 Average assets 17,066 493 a. Use the data above to calculate the following ratios: EBITA/Average assets, EBITA Margin, EBITA/ Interest expense, Debt/EBITDA, CAPEX/Depreciation Expense. Definitions for these ratios are in Exhibit 7.4. b. Refer to Exhibit 7.4 and the ratios you calculated in part a. Estimate the credit rating that Moody's might assign to Kellogg. Round answers to one decimal place (percentage ex: 0.2345 = 23.5%) Ratio Moody's rating EBITA/Avg. assets EBITA margin EBITA/Int. expense Debt/EBITDA CAPEX/Dep. expense Please answer all parts of the question. 0% 0% 0 0 0 ◆ ◆arrow_forwardUse the statement of financial position as at 31 December 2022, statement of comprehensive income for the year ended 31 December 2022 and additional information for 2022 (related to dividends and shares) to calculate the ratio (expressed to two decimal places) that would reflect each of the following: 1. The extent to which the claims of the short-term creditors are covered by assets that can be translated into cash in the short term2. The extent to which long-term debt is covered by shareholders’ funds3. The amount of funds available relative to sales, to pay the company’s expenses other than its cost of sales (expressed as a percentage)4. The distributions during the period allocated to each ordinary share issued5. An indication of the percentage of the profit that has been put back into the company 6. The ratio of a company's current stock price to its earnings per sharearrow_forwardThe comparative statements of Dubai Company are presented below. All sales were on account. The allowance for doubtful accounts was $3,200 on December 31, 2017, and $3,000 on December 31, 2020. Required: Compute the following ratios for 2021. (Weighted average common shares in 2021 were 62,500.) Times interest earned. Asset turnover. Debt to assets.arrow_forward
- FINANCIAL RATIO: Requirement: Compute for the following financial ratios for the year 2021 (round-off answers to two decimal places) f. Accounts receivable turnover (assume all sales are on credit) g. Days of receivable (use 365 days) h. Debt ratio i. Equity ratio j. Debt-to-equity ratio k. Gross profit ratio 1. Net profit ratio m. Return on assets n. Return on equityarrow_forwardistructions alance sheet for Sandpiper Corporation as of December 31, 2020 using column 2 3 for nets, sub-totals, & totals on the 4-column accounting paper provided online. e the units, tens, hundreds, thousands, etc. in the proper mini column, and leave o commas are necessary when you use the accounting paper properly. Dollar signs f the column and after a total line. o present the following ratios to the nearest tenth: ratio, Debt to assets ratio, Ratio of fixed assets to long-term liabilities, Ratio of total ders' equityarrow_forwardSport Enterprises have individual accounts for their debtors in a debtors subsidiary ledger and have a debtors control account in the general ledger. The balance of the debtors control account at 1 May 2021 is R169 200. The following information was provided for the month ending 31 May 2021: NB: Insert the amount of R4 500 for the credit note in additional amount 3.4 1. Journals provided the following totals for relevant transactions: For the month ended 31 May 2021: Sales journal: Dehtors column 762 000 Sales returns journal 6 300 Cash receipts journal: Debtors column 586 800 2 100 General Journal: Interest charged on overdue debtors' accounts General Journal: Debtors balances written off as irrecoverable 2 700 2. The debtors ledger clerk submitted the following: List of debtors balances as at 31 May 2021 – debit balances C Gale 31 500 Н Bot 132 300 G Hunt 182 700 I Khune 18 900 R Nadal 9 000 3. Additional information to be taken.into.account (not included in the above): 3.1 No entry…arrow_forward
- Dear Bartleby could you please calculate the debt equity ratio for the following, thank you. Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2020 and 2019. (Round "Debt ratio" to 1 decimal place and "Debt/equity ratio" to the nearest whole percent.) Presented here are summarized data from the balance sheets and income statements of Wiper Inc.: WIPER INC. Condensed Balance Sheets December 31, 2020, 2019, 2018 (in millions) 2020 2019 2018 Current assets $ 650 $ 900 $ 700 Other assets 2,750 2,050 1,750 Total assets $ 3,400 $ 2,950 $ 2,450 Current liabilities $ 500 $ 800 $ 700 Long-term liabilities 1,500 1,000 800 Stockholders' equity 1,400 1,150 950 Total liabilities and stockholders' equity $ 3,400 $ 2,950 $ 2,450 WIPER INC. Selected Income Statement and Other Data For the year Ended December 31, 2020 and 2019 (in millions) 2020 2019 Income statement data:…arrow_forwardReview the Republic Financial Holdings Limited 2022 annual report. What recommendations can be made for the preparation of the financial statements ?arrow_forwardFINANCIAL RATIO: Requirement: Compute for the following financial ratios for the year 2021 (round-off answers to two decimal places) a. Current ratio b. Quick (Acid-test) ratio c. Working capital d. Inventory turnover e. Days of inventory (use 365 days) f. Accounts receivable turnover (assume all sales are on credit) g. Days of receivable (use 365 days) h. Debt ratio i. Equity ratio j. Debt-to-equity ratio k. Gross profit ratio 1. Net profit ratio m. Return on assets n. Return on equityarrow_forward
- Intermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
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