Grand Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Question

Question

Grand Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In additi

business accounting

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Pretax book income	600000
less:Tax depreciation exceeding book depreciation	-400000
Tax exempt municipal bond interest (being exempt for tax purpose already included in book income)	-300000

Taxable income /(loss)	-100000
out of this
Being net operating tax loss carry back to prior year (up to income available )(forgone)	0
so Remaining tax loss (100000-50000) carry forward to future years resulting in deferred tax asset	10000*21%= 21000

Deferred income tax benefit = $ 21000

**Company has an option to forgo carry-back provision .

Add a comment

Answer 2

Similar Homework Help Questions

Grand Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Grand Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In addition, the company received $300,000 of tax-exempt municipal bond interest. The company’s prior-year tax return showed taxable income of $50,000. Compute the company's current or deferred income tax expense or benefit. Deferred income tax benefit:
Harrison Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Harrison Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In addition, the company received $300,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $50,000. Compute the company's deferred income tax expense or benefit. Deferred income tax expense
Harrison Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Harrison Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In addition, the company received $300,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $50,000. Compute the company's deferred income tax expense or benefit. Deferred income tax expense $ 0

Burcham Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Burcham Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In addition, the company received $300,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $50,000. Compute the company's book equivalent of taxable income. Use this number to compute the company's total income tax provision or benefit. Book equivalent of taxable income Total income tax provision or benefit
Grand Corporation reported pretax book income of $752,500. Tax depreciation exceeded book depreciation by $620,000. In...

Grand Corporation reported pretax book income of $752,500. Tax depreciation exceeded book depreciation by $620,000. In addition, E the company received $320,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income E of $117,000. Compute the company's current or deferred income tax expense or benefit. & Answer is complete but not entirely correct. Deferred income tax benefit $ 14,805
Grand Corporation reported pretax book income of $627,500. Tax depreciation exceeded book depreciation by $490,000. In...

Grand Corporation reported pretax book income of $627,500. Tax depreciation exceeded book depreciation by $490,000. In addition, the company received $290,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $61,000. Compute the company's current or deferred income tax expense or benefit. Answer is complete but not entirely correct. Deferred income tax benefit $ 31,110 This is all the information given. There is no mention to what the tax rate is. Sorry.

Grand Corporation reported pretax book income of $672,500. Tax depreciation exceeded book depreciation by $550,000. In...

Grand Corporation reported pretax book income of $672,500. Tax depreciation exceeded book depreciation by $550,000. In addition, the company received $210,000 of tax-exempt municipal bond interest. The company’s prior-year tax return showed taxable income of $55,000. Compute the company's current or deferred income tax expense or benefit.
Grand Corporation reported pretax book income of $807,500. Tax depreciation exceeded book depreciation by $690,000. In...

Grand Corporation reported pretax book income of $807,500. Tax depreciation exceeded book depreciation by $690,000. In addition, the company received $160,000 of tax-exempt municipal bond interest. The company’s prior-year tax return showed taxable income of $36,000. Compute the company's deferred income tax benefit. Assumed tax rate is 21%
Grand Corporation reported pretax book income of $795,000. Tax depreciation exceeded book depreclation by $595,000. In...

Grand Corporation reported pretax book income of $795,000. Tax depreciation exceeded book depreclation by $595,000. In addition, the company recelved $311,000 of tax-exempt municipal bond Interest. The company's prior-year tax return showed taxable Income of $74,000. Compute the company's current income tax expense or benefit. urrent income tax benefit

Harrison Corporation reported pretax book income of $807,500. Tax depreciation exceeded book depreciation by $690,000. In...

Harrison Corporation reported pretax book income of $807,500. Tax depreciation exceeded book depreciation by $690,000. In addition, the company received $160,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $36,000. Compute the company's deferred income tax expense or benefit. E Deferred income tax benefit Deferred income tax benefit Deferred income tax expense

Grand Corporation reported pretax book income of $600,000. Tax depreciation exceeded book depreciation by $400,000. In...

Homework Answers