Loose Leaf Advanced Accounting with Connect Access Card
12th Edition
ISBN: 9781259184741
Author: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupnik
Publisher: McGraw-Hill Education
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Question
Chapter 7, Problem 23P
a.
To determine
Find the amount of income tax paid on a consolidated tax return.
b.
To determine
Find the amount of income tax paid on separate tax returns.
c.
To determine
Find the total amount of income tax expense which a consolidated income statement recognizes.
d.
To determine
Find the amount of income tax which Mr. G has to pay on separate tax returns.
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Garrison holds a controlling interest in Robertson's outstanding stock. For the current year, the following information has been gathered about these two companies:
Garrison
Robertson
Separate operating income
$
300,000
$
200,000
(includes $50,000 intra-entity gross profit in ending inventory)
Dividends paid
32,000
50,000
Tax rate
21
%
21
%
Garrison uses the initial value method to account for the investment in Robertson. Garrison's separate operating income figure does not include dividend income for the current year.
Assume that Garrison owns 70 percent of Robertson's voting stock. What total amount of income tax expense does a consolidated income statement recognize? (Round your intermediate calculations and final answer to nearest whole dollar amount.)
Garrison holds a controlling interest in Robertson's outstanding stock. For the current year, the following information has been gathered about these two companies:
Garrison
Robertson
Separate operating income
$
300,000
$
200,000
(includes $50,000 intra-entity gross profit in ending inventory)
Dividends paid
32,000
50,000
Tax rate
21
%
21
%
Garrison uses the initial value method to account for the investment in Robertson. Garrison's separate operating income figure does not include dividend income for the current year.
Assume that Garrison owns 80 percent of Robertson's voting stock. On a consolidated tax return, what amount of income tax is paid?
Assume that Garrison owns 80 percent of Robertson's voting stock. On separate tax returns, what total amount of income tax is paid?
Assume that Garrison owns 70 percent of Robertson's voting stock. What total amount of income tax expense does a consolidated income statement…
Garrison holds a controlling interest in Robertson's outstanding stock. For the current year, the following information has been gathered about these two companies:
Garrison
Robertson
Separate operating income
$
300,000
$
200,000
(includes $50,000 intra-entity gross profit in ending inventory)
Dividends paid
32,000
50,000
Tax rate
21
%
21
%
Garrison uses the initial value method to account for the investment in Robertson. Garrison's separate operating income figure does not include dividend income for the current year.
Assume that Garrison owns 80 percent of Robertson's voting stock. On a consolidated tax return, what amount of income tax is paid?
Assume that Garrison owns 80 percent of Robertson's voting stock. On separate tax returns, what total amount of income tax is paid?
Assume that Garrison owns 70 percent of Robertson's voting stock. What total amount of income tax expense does a consolidated income statement…
Chapter 7 Solutions
Loose Leaf Advanced Accounting with Connect Access Card
Ch. 7 - Prob. 1QCh. 7 - Prob. 2QCh. 7 - Prob. 3QCh. 7 - How does the presence of an indirect ownership...Ch. 7 - Prob. 5QCh. 7 - In accounting for mutual ownerships, what is the...Ch. 7 - Prob. 7QCh. 7 - Prob. 8QCh. 7 - Prob. 9QCh. 7 - Prob. 10Q
Ch. 7 - Prob. 11QCh. 7 - Jones acquires Wilson, in part because the new...Ch. 7 - Prob. 13QCh. 7 - Prob. 1PCh. 7 - Prob. 2PCh. 7 - Prob. 3PCh. 7 - Which of the following is correct for two...Ch. 7 - Prob. 5PCh. 7 - Prob. 6PCh. 7 - Prob. 7PCh. 7 - Prob. 8PCh. 7 - Prob. 9PCh. 7 - Prob. 10PCh. 7 - Prob. 11PCh. 7 - Prob. 12PCh. 7 - Prob. 13PCh. 7 - Prob. 14PCh. 7 - Prob. 15PCh. 7 - Prob. 16PCh. 7 - Prob. 17PCh. 7 - Prob. 18PCh. 7 - Prob. 19PCh. 7 - Clarke has a controlling interest in Rogerss...Ch. 7 - Prob. 21PCh. 7 - Prob. 22PCh. 7 - Prob. 23PCh. 7 - Prob. 24PCh. 7 - Prob. 25PCh. 7 - Prob. 26PCh. 7 - Prob. 27PCh. 7 - Prob. 28PCh. 7 - Prob. 29PCh. 7 - Prob. 1DYSCh. 7 - Access The Coca-Cola Company’s 2012 financial...
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