Solution:
Particulars | Amount | Rate of Tax | Tax | Recorded as |
Pretax accounting income | $58,000.00 | |||
Permanent difference | $0.00 | |||
Income subject to taxation | $58,000.00 | 25% | $14,500.00 | Income tax expense |
Temporary differences: | ||||
Depreciation | -$42,000.00 | 25% | -$10,500.00 | Deferred tax liability |
Prepaid Expenses | -$16,000.00 | 25% | -$4,000.00 | Deferred tax liability |
Warranty expense | $14,000.00 | 25% | $3,500.00 | Deferred tax assets |
Income taxable in current year | $14,000.00 | 25% | $3,500.00 | Income Tax Payable |
Journal Entries | |||
Date | Particulars | Debit | Credit |
31-Dec-21 | Income tax expense Dr | $14,500.00 | |
Deferred tax assets Dr | $3,500.00 | ||
To Income taxes payable | $3,500.00 | ||
To Deferred tax liability | $14,500.00 | ||
(To record income tax expense) |
The information that follows pertains to Esther Food Products: a. At December 31, 2021, temporary differences...
The information that follows pertains to Esther Food Products: a. At December 31, 2018, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses $ 58,000 25,000 (7,000) b. No temporary differences existed at the beginning of 2018. C. Pretax accounting income was $98,000 and taxable income was $22,000 for the year ended December 31, 2018. d. The tax rate is 40%. Required: Complete the following table given below and prepare the appropriate journal...
The information that follows pertains to Esther Food Products: a. At December 31, 2018, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses (10,00) $66,000 28,000 b. No temporary differences existed at the beginning of 2018 c. Pretax accounting income was $109,000 and taxable income was $25,000 for the year ended December 31, 2018 d. The tax rate is 45% Required: Complete the following table given below and prepare the appropriate journal entry...
The information that follows pertains to Esther Food
Products:
At December 31, 2018, temporary differences were associated
with the following future taxable (deductible) amounts:
Depreciation
$
46,000
Prepaid expenses
19,000
Warranty expenses
(16,000
)
No temporary differences existed at the beginning of 2018.
Pretax accounting income was $65,000 and taxable income was
$16,000 for the year ended December 31, 2018.
The tax rate is 40%.
Homework -- Chapter 16.2 More Deferred Taxes an... O Saved Help Save & Exit Submit...
The information that follows pertains to Richards Refrigeration, Inc.: At December 31, 2021, temporary differences existed between the financial statement book values and the tax bases of the following: ($ in millions) Book Value Tax Basis Future Taxable (Deductible) Amount Buildings and equipment (net of accumulated depreciation) $ 158 $ 109 $ 49 Prepaid insurance 69 0 69 Liability—loss contingency 44 0 (44 ) No temporary differences existed at the beginning of 2021. Pretax accounting income was $219 million and...
The information that follows pertains to Richards Refrigeration, Inc.: a. At December 31, 2021, temporary differences existed between the financial statement book values and the tax bases of the following: (s in millions) Future Taxable Tax (Deductible) Basis Amount $90 $ 30 50 B (25) Book Value $120 50 25 Buildings and equipment (net of accumulated depreciation) Prepaid insurance Liability-loss contingency b. No temporary differences existed at the beginning of 2021. c. Pretax accounting Income was $200 million and taxable...
The information that follows pertains to Richards Refrigeration, Inc.: a. At December 31, 2018, temporary differences existed between the financial statement carrying amounts and the tax bases of the following: ($ in millions) Future Taxable Carrying Tax (Deductible) Amount Basis Amount $ 148 $ 104 $ 44 64 39 (39) Buildings and equipment (net of accumulated depreciation) Prepaid insurance Liability-loss contingency 64 b. No temporary differences existed at the beginning of 2018. c. Pretax accounting income was $214 million and...
The information that follows pertains to Richards Refrigeration, Inc.: a. At December 31, 2018, temporary differences existed between the financial statement carrying amounts and the tax bases of the following: $ in Carrying Tax Amount Basis $134 $97 illions) Future Taxable Deductible) Amount $ 37 Buildings and equipment (net of accumulated depreciation) Prepaid insurance Liability-loss contingency (32) b. No temporary differences existed at the beginning of 2018 c. Pretax accounting income was $207 million and taxable income was $145 million...
The information that follows pertains to Richards Refrigeration, Inc.: a. At December 31, 2018, temporary differences existed between the financial statement carrying amounts and the tax bases of the following: ( in millions ) Future Taxable (Deductible) Carrying Таx Basis Amount $47 Amount Buildings and equipment (net of accumu lated depreciation) Prepaid insurance Liability-loss contingency $154 $107 67 67 (42) 42 b. No temporary differences existed at the beginning of 2018. c. Pretax accounting income was $217 million and taxable...
The information that follows pertains to Richards Refrigeration, Inc.: a. At December 31, 2018, temporary differences existed between the financial statement carrying amounts and the tax bases of the following: (S in millions) Future Taxable Carrying Amount $136 (Deductible) Тах Вавів Amount Buildings and equipment (net of accumulated depreciation) Prepaid insur ance Liability-loss contingency $98 0 $38 58 58 0 (33) 33 b. No temporary differences existed at the beginning of 2018. c. Pretax accounting income was $208 million and...
. JUU have completed so far. It does not indicate complet The information that follows pertains to Esther Food Products: a. At December 31, 2021, temporary differences were associated with the following future taxable (deductible) amounts: Depreciation Prepaid expenses Warranty expenses $ 66,000 28,000 (10,000) b. No temporary differences existed at the beginning of 2021 C. Pretax accounting income was $109,000 and taxable income was $25,000 for the year ended December 31, 2021 d. The tax rate is 25% Required:...