Noventis Corporation prepared the following estimates for the four quarters of the current year:
First Quarter |
Second Quarter |
Third Quarter |
Fourth Quarter |
|||||||||
Sales | $ | 1,300,000 | $ | 1,560,000 | $ | 1,820,000 | $ | 2,080,000 | ||||
Cost of goods sold | 430,000 | 510,000 | 580,000 | 630,000 | ||||||||
Administrative costs | 310,000 | 185,000 | 190,000 | 200,000 | ||||||||
Advertising costs | 0 | 100,000 | 0 | 0 | ||||||||
Executive bonuses | 0 | 0 | 0 | 76,000 | ||||||||
Provision for bad debts | 0 | 0 | 0 | 64,000 | ||||||||
Annual maintenance costs | 72,000 | 0 | 0 | 0 | ||||||||
Additional Information
Assuming that actual results do not vary from the estimates provided, determine the amount of net income to be reported each quarter of the current year.
Assume that actual results do not vary from the estimates provided except for that in the third quarter, the estimated annual effective income tax rate is revised downward to 38 percent. Determine the amount of net income to be reported each quarter of the current year
Net income to be reported Amount in $
Particulars | Qtr 1 | Qtr 2 | Qtr 3 | Qtr 4 |
---|---|---|---|---|
Sales | 1300,000 | 1560,000 | 1820,000 | 2080,000 |
Less: Cost of goods sold | (430,000) | (510,000) | (580,000) | (630,000) |
Gross Profit | 870,000 | 1050,000 | 1240,000 | 1450,000 |
Less: Administrative Costs (Excl annual insurance premium) | (150,000) | (185,000) | (190,000) | (200,000) |
Less: Annual insurance premium (160,000/4) | (40,000) | (40,000) | (40,000) | (40,000) |
Less:Advertising costs (To be apportioned over 4 quarters - 100,000 / 4) | (25,000) | (25,000) | (25,000) | (25,000) |
Less: Executive bonuses | (76,000) | |||
Less: Provision for bad debts | (64,000) | |||
Less: Annual maintenance costs (To be apportioned over the year - 72,000/4) | (18,000) | (18,000) | (18,000) | (18,000) |
Profit before Tax | 637,000 | 782,000 | 967,000 | 278,000 |
Less: Income tax expense | (254,800) | (312,800) | (339,080) | (105,640) |
Net Income after Tax | 382,200 | 469,200 | 627,920 | 172,360 |
Note: Tax for 3 rd quarter
Cumulative Income upto 3rd quarter = 637,000 + 782,000 + 967,000 = $ 23,86,000
Tax expense @ 38% = (23,86,000*38%) = $ 906,680
Less: Cumulative tax expense upto 2nd quarter = $ 254800+$312800= ($567,600)
Balance tax to be recognized in 3rd quarter = $ 339,080
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter...
Check Noventis Corporation prepared the following estimates for the four quarters of the current year. $ First Quarter 1,300,eee 430,000 310,000 $ Second Quarter 1,560,000 510,000 185,000 100,000 Sales Cost of goods sold Administrative costs Advertising costs Executive bonuses Provision for bad debts Annual maintenance costs $ Third Quarter 1,820,000 580,000 190,000 $ Fourth Quarter 2,080,000 630,000 200,000 76,000 64,000 72,000 Additional Information • First-quarter administrative costs include the $160.000 annual insurance premium • Advertising costs paid in the second...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter Second Quarter Third Quarter Fourth Quarter Sales $ 1,550,000 $ 1,860,000 $ 2,170,000 $ 2,480,000 Cost of goods sold 456,000 536,000 606,000 656,000 Administrative costs 390,000 225,000 230,000 240,000 Advertising costs 0 140,000 0 0 Executive bonuses 0 0 0 60,000 Provision for bad debts 0 0 0 80,000 Annual maintenance costs 88,000 0 0 0 Additional Information First-quarter administrative costs include the $130,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter Second Quarter Third Quarter Fourth Quarter Sales $ 1,200,000 $ 1,440,000 $ 1,680,000 $ 1,920,000 Cost of goods sold 420,000 500,000 570,000 620,000 Administrative costs 290,000 175,000 180,000 190,000 Advertising costs 0 180,000 0 0 Executive bonuses 0 0 0 68,000 Provision for bad debts 0 0 0 60,000 Annual maintenance costs 68,000 0 0 0 Additional Information First-quarter administrative costs include the $140,000...
Noventis Corporation prepared the following estimates for the
four quarters of the current year:
First
Quarter
Second
Quarter
Third
Quarter
Fourth
Quarter
Sales
$
1,575,000
$
1,890,000
$
2,205,000
$
2,520,000
Cost of goods sold
458,000
538,000
608,000
658,000
Administrative costs
380,000
220,000
225,000
235,000
Advertising costs
0
120,000
0
0
Executive bonuses
0
0
0
104,000
Provision for bad debts
0
0
0
78,000
Annual maintenance costs
86,000
0
0
0
Additional Information
First-quarter administrative costs include the $120,000...
Noventis Corporation prepared the following estimates for the four quarters of the current year: First Quarter Second Quarter Third Quarter Fourth Quarter Sales $ 1,250,000 $ 1,500,000 $ 1,750,000 $ 2,000,000 Cost of goods sold 425,000 505,000 575,000 625,000 Administrative costs 300,000 180,000 185,000 195,000 Advertising costs 0 200,000 0 0 Executive bonuses 0 0 0 72,000 Provision for bad debts 0 0 0 62,000 Annual maintenance costs 70,000 0 0 0 Additional Information First-quarter administrative costs include the $150,000...
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Noventis Corporation prepared the following estimates for the four quarters of the current year: $ First Quarter 1,300,000 430,000 310,000 $ Second Quarter 1,560,000 510,000 185,000 100,000 $ Third Quarter 1,820,000 580,000 190,000 $ Fourth Quarter 2,080,000 630,000 200,000 Sales Cost of goods sold Administrative costs Advertising costs Executive bonuses Provision for bad debts Annual maintenance costs 76,000 64,000 72,000 Additional Information • First-quarter administrative costs include the $160,000 annual insurance premium. • Advertising costs...
Noventis Corporation prepared the following estimates for the four quarters of the current year: $ First Quarter 1,525, 000 454.209 4ee, 800 $ $ Third Quarter 2,135,000 684,800 235,899 $ Second Quarter 1,830,000 534,00 230,899 160, eee Fourth Quarter 2,440,000 654.209 245,899 Sales Cost of goods sold Administrative costs Advertising costs Executive bonuses Provision for bad debts Annual maintenance costs 64.ee 82,800 90,000 Additional Information • First-quarter administrative costs include the $140.000 annual insurance premium. 1. Advertising costs paid in...
Noventis Corporation prepared the following estimates for the four quarters of the current year: $ First Quarter 1,525, 000 454.209 4ee, 800 $ $ Third Quarter 2,135,000 684,800 235,899 $ Second Quarter 1,830,000 534,00 230,899 160, eee Fourth Quarter 2,440,000 654.209 245,899 Sales Cost of goods sold Administrative costs Advertising costs Executive bonuses Provision for bad debts Annual maintenance costs 64.ee 82,800 90,000 Additional Information • First-quarter administrative costs include the $140.000 annual insurance premium. 1. Advertising costs paid in...
For the current year, LNS corporation reported the following taxable income at the end of its first, second, and third quarters. Quarter-End First Second Third Cumulative Taxable Income $ 1,000,000 1,600,000 2,400,000 What are LNS's minimum first, second, third, and fourth quarter estimated tax payments, using the annualized income method? (Enter all amounts as positive values. Leave no answer blank. Enter zero if applicable. Round "Annualization Factor" for Fourth quarter to 7 places. Round other intermediate computations and final answers...
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