ZuoTi.Pro
Question

Relix, Inc., is a domestic corporation. Relix, Inc., reported two permanent differences between book and taxable...

Relix, Inc., is a domestic corporation. Relix, Inc., reported two permanent differences between book and taxable income. It earned $2,375 in tax-exempt municipal bond interest, and it incurred $780 in nondeductible business meals expense. Relix's book income before tax is $4,800. Assume a 21% Federal corporate tax rate.

Provide the information for the income tax footnote rate reconciliation for Relix.

For dollar amounts, round to the nearest dollar and use rounded amounts in subsequent computations. For the percentage answers, round to four decimal places before converting to a percentage. For example, round .56329 to .5633 and enter as 56.33%.

Dollars Percentage
Tax on book income at statutory rate $ %
Tax-exempt income %
Nondeductible business meals %
Provision for income tax expense $ %
business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

ANSWER

The company earned $2,375 before taxes of which it should pay 21% income taxes, however the company earned certain income for which he is not liable to pay tax i.e. 2,375 and incurred certain expenses on which the company cant avail credit i.e. 780 .
Tax on Book Income (a) 4,800*21% 1,008 21% This percentage is calculated as amount divided by total Income i.e. 1,008/4,800
Tax exempt income (b) 2,375 *21%        499 10.39% 499/4,800= 10.39%
Non Deductible business meals © 780 *21%           164 3.42% 164/4,800= 3.41%
Provision for income tax expense a-b+c 673 14.03%

_____________________________________________

If you have any query or any Explanation please ask me in the comment box, i am here to helps you.please give me positive rating.

*****************THANK YOU**************

0 0
Add a comment
Know the answer?
Add Answer to:
Relix, Inc., is a domestic corporation. Relix, Inc., reported two permanent differences between book and taxable...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year...

    Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year before recording any net deferred tax asset or net deferred tax liability. Tax Debit/(Credit) Book Debit/(Credit) Assets Cash $500 $500 Accounts receivable 8,000 8,000 Buildings 750,000 750,000 Accumulated depreciation (450,000) (380,000) Furniture and fixtures 70,000 70,000 Accumulated depreciation (46,000) (38,000) Total assets $332,500 $410,500 Liabilities Accrued litigation expense $0 ($50,000) Note payable (78,000) (78,000) Total liabilities ($78,000) ($128,000)...

  • Fill-in choices are add: or less: Problem 3-34 (LO. 2) Relix, Inc., is a domestic corporation...

    Fill-in choices are add: or less: Problem 3-34 (LO. 2) Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year before recording any net deferred tax asset or net deferred tax liability. Tax Debit/(Credit) Book Debit/Credit) Assets Cash $500 $500 Accounts receivable 8,000 8,000 750,000 750,000 Buildings Accumulated depreciation Furniture and fixtures Accumulated depreciation Total assets (450,000) 70,000 (46,000) (380,000) 70,000 (38,000) $332,500 $410,500 Liabilities Accrued litigation expense...

  • Problem 3-42 (LO. 2) Kantner, Inc., is a domestic corporation with the following balance sheet for...

    Problem 3-42 (LO. 2) Kantner, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Tax Debit/Credit) Book Debit/Credit) Assets Cash Accounts receivable Buildings Accumulated depreciation Furniture and fixtures $1,000 9,000 850,000 (700,000) 40,000 (10,000) $190,000 $1,000 9,000 850,000 (620,000) 40,000 Accumulated depreciation (8,000) $272,000 Total assets Liabilities SO Accrued warranty expense Note payable (16,000) ($40,000) (16,000) ($56,000) ($16,000) Total liabilities Stockholders' Equity Paid-in capital Retained earnings ($50,000) (124,000)...

  • Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes...

    Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year before recording any net deferred tax asset or net deferred tax liability. Tax Debit/(Credit) Book Debit/(Credit) Assets Cash $500 $500 Accounts receivable 8,000 8,000 Buildings 750,000 750,000 Accumulated depreciation (450,000) (380,000) Furniture and fixtures 70,000 70,000 Accumulated depreciation (46,000) (38,000) Total assets $332,500 $410,500 Liabilities Accrued litigation expense $0 ($50,000) Note payable (78,000) (78,000) Total liabilities ($78,000) ($128,000)...

  • Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax...

    Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax rate is 21%. Book income before tax $650,000 Bad debt allowance $25,000 Meals ($30,000 * 50%) $15,000 Tax-exempt interest income $(20,000) Wages not paid in 2 ½ months $45,000 Taxable income $715,000 Compute Cremshaw’s financial tax expense and Cremshaw’s tax payable.

  • (c) Problem 2. The following differences between financial and taxable income were reported by Dider Corporation...

    (c) Problem 2. The following differences between financial and taxable income were reported by Dider Corporation for the year: (a) Excess of tax depreciation over book depreciation $10,000 (b) Interest revenue on municipal bonds 9,000 Excess of estimated warranty expense over actual expenditures 54,000 (d) Rent of next year paid 12.000 Fines paid 30,000 (t) Excess of income reported under percentage-of-completion accounting for financial reporting over completed-contract accounting used for tax reporting. 45,000 Interest on indebtedness incurred to purchase tax-exempt...

  • Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax...

    Cremshaw Inc.’s auditors prepared the following detail reconciliation between book and taxable income. Cremshaw’s income tax rate is 21%. Book income before tax $650,000 Bad debt allowance $25,000 Meals ($30,000 * 50%) $15,000 Tax-exempt interest income $(20,000) Wages not paid in 2 ½ months $45,000 Taxable income $715,000 Compute the net increase in Cremshaw’s deferred tax assets or liabilities for the year and identify whether deferred tax assets or liabilities increased.

  • e IH) new doc 201901-22 18 × It Ο ώ | O file:///C:/UserstałalDownloads/new%20doc%202019-01.22%2018.5749%20(1).pdf Baltimore Inc. reported...

    e IH) new doc 201901-22 18 × It Ο ώ | O file:///C:/UserstałalDownloads/new%20doc%202019-01.22%2018.5749%20(1).pdf Baltimore Inc. reported pretax GAAP income of $45,000 in 2020. In analyzing differences between GAAP in- come and taxable income, the company determined that it had deducted S5,000 in nondeductible fines and added $2,800 in tax-exempt municipal interest revenue to GAAP income. Given a statutory tax rate of25%, determine the following a. Taxable income b. Income tax payable c. Income tax expense d. Net income Effective tax...

  • Cass Corporation reported pretax book income of $10,740,000. During the current year, the reserve...

    Cass Corporation reported pretax book income of $10,740,000. During the current year, the reserve for bad debts increased by $247,500. In addition, tax depreciation exceeded book depreciation by $290,000. Cass Corporation sold a fixed asset and reported book gain of $110,000 and tax gain of $143,500. Finally, the company received $329,000 of tax-exempt life insurance proceeds from the death of one of its officers. Compute the company’s current income tax expense or benefit. (Round your final answers to nearest whole...

  • Harrison Corporation reported pretax book income of $825,000. Tax depreciation exceeded book depreciation by $560,000. In...

    Harrison Corporation reported pretax book income of $825,000. Tax depreciation exceeded book depreciation by $560,000. In addition, the company received $315,000 of tax-exempt municipal bond interest. The company’s prior-year tax return showed taxable income of $25,000. Assuming a tax rate of 21 percent, compute the company’s deferred income tax expense or benefit.

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT