Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same. Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises. To determine the income tax payable for 2018 Given information: Pretax financial income $550,000 Interest in municipal bonds $70,000 Fine for dumping hazardous waste $25,000 Depreciation based on books of records $60,000 Permissible depreciation as per income tax $45,000 Rate of income tax 30%

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Answer 1

Question

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

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Answer 2

Question

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

Expert Solution & Answer

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Answer 3

Question

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

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Answer 4

Question

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

Expert Solution & Answer

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Answer 5

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

Answer 6

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

Answer 7

Chapter 19, Problem 13Q

To determine

Permanent difference: The constant mismatch between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as permanent difference. The difference is caused either by including a transaction in the books of records and not in taxable income or including a transaction in taxable income but not in books of records due to business situations. These differences are not adjustable in the future and remain the same.

Temporary differences: The difference between actual taxable income and the books of records maintained by an individual, a firm, or an entity is termed as temporary difference. The difference is caused due to the tenure of transactions or actual performance of transactions, flow of funds into the business, or changes in the value of the asset or liability because of business situations. These differences are adjustable in future when the appropriate time for the transaction arises.

To determine the income tax payable for 2018

Given information:

Pretax financial income

$550,000

Interest in municipal bonds

$70,000

Fine for dumping hazardous waste

$25,000

Depreciation based on books of records

$60,000

Permissible depreciation as per income tax

$45,000

Rate of income tax

30%

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 19 - Prob. 1Q Ch. 19 - Prob. 2Q Ch. 19 - Prob. 3Q Ch. 19 - Prob. 4Q Ch. 19 - Prob. 7Q Ch. 19 - Prob. 11Q Ch. 19 - Prob. 12Q Ch. 19 - Prob. 13Q Ch. 19 - Prob. 15Q Ch. 19 - Prob. 16Q

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Chapter 19 Solutions

Pretax financial income	$550,000
Interest in municipal bonds	$70,000
Fine for dumping hazardous waste	$25,000
Depreciation based on books of records	$60,000
Permissible depreciation as per income tax	$45,000
Rate of income tax	30%