Company C started business on January 1, 20X1, and bought the following piece of equipment.
Cost of asset | $200,000 |
Salvage | 20,000 |
Useful life | 5 |
Tax rate | 21% |
20X1 estimated tax payment | 4,000 |
Depreciation for book and tax purposes is as follows:
Book | Tax | |
20X1 | 36,000 | 80,000 |
20X2 | 36,000 | 48,000 |
20X3 | 36,000 | 28,800 |
20X4 | 36,000 | 17,280 |
20X5 | 36,000 | 5,920 |
20X1 income statement information:
Sales | 362,000 |
Expenses (does not include depreciation expense and tax expense) | 217,000 |
What is the ending balance of deferred taxes payable-depreciation on the December 31, 20X1 balance sheet?
Depreciation as per Book for 20X1 | 36,000 | |
Depreciation as per Tax for 20X1 | 80,000 | |
Difference in Depreciation liable for Deferred tax liability | 44,000 | =80000-36000 |
Balance of deferred taxes payable-depreciation on the December 31, 20X1 | $ 9,240 | =44000*21% |
Company C started business on January 1, 20X1, and bought the following piece of equipment. Cost...
Company C started business on January 1, 20X1, and bought the following piece of equipment. Cost of asset $700,000 Salvage 70,000 Useful life 5 Tax rate 21% 20X1 estimated tax payment 14,000 Depreciation for book and tax purposes is as follows: Book Tax 20X1 126,000 280,000 20X2 126,000 168,000 20X3 126,000 100,800 20X4 126,000 60,480 20X5 126,000 20,720 20X1 income statement information: Sales 1,267,000 Expenses (does not include depreciation expense and tax expense) 760,000 What is the ending balance of...
Company D started business on January 1, 20X1, and bought the following piece of equipment. Cost of asset $300,000 Salvage 30,000 Useful life 5 Tax rate 21% 20X1 estimated tax payment 6,000 Depreciation for book and tax purposes is as follows: Book Tax 20X1 54,000 120,000 20X2 54,000 72,000 20X3 54,000 43,200 20X4 54,000 25,920 20X5 54,000 8,880 What is the ending balance of deferred taxes payable-depreciation on the December 31, 20X3 balance sheet? (You do not need income statement...
3 Same fact pattern as Questions 1 and 2. Problem 1, Question 3. Company A started business on January 1, 20X1, and bought the following piece of equipment. Cost of asset $150,000 Salvage 30,000 Useful life Tax rate 21% 20X1 estimated tax payment 1,800 Depreciation for book and tax purposes is as follows: Book Tax 20x1 40,000 100,000 20X2 40,000 20,000 40,000 0 20X1 income statement information: Sales 638,000 Expenses (does not include depreciation expense and tax expense) 510,000 20X3...
Questions 4 and 5 use the below fact pattern. Problem 2, Question 5. Company B acquired the following piece of equipment. Your staff accountant computed the book and tax depreciation. It is up to you to determine the deferred tax amounts. Equipment cost $50,000 Salvage 5,000 Useful life Tax rate 21% Depreciation for book and tax purposes is as follows: Book 20X1 9 ,000 20,000 20x2 9,000 12,000 20X3 9,000 7,200 20X4 9,000 4,320 20X5 9,000 1,480 Tax 5) What...
3 Same fact pattern as Question 1. Problem 1, Question 2. Company A started business on January 1, 20x1, and bought the following piece of equipment. Cost of asset $150,000 Salvage 30,000 Useful life Tax rate 21% 20X1 estimated tax payment 1,800 Depreciation for book and tax purposes is as follows: Book Tax 20X1 40,000 100,000 20x2 4 0,000 20,000 20x3 40,000 20X1 income statement information: Sales 638,000 Expenses (does not include depreciation expense and tax expense) 510,000 2) What...
On January 1, 20X1, Local Bakery started operations. The company acquired a piece of equipment by issuing a note payable on that date. The note had a below market rate of interest. Terms of the purchase of the equipment: Coupon rate Market rate Note payable $200,000 1.30% 5.90% Note term 6 years The note is due in equal annual payments of principle and interest. The company uses straight-line depreciation for book purposes. Depreciation information on the equipment: Useful life of...
On January 1, 20X1, Local Bakery started operations. The company acquired a piece of equipment by issuing a note payable on that date. The note had a below market rate of interest. Terms of the purchase of the equipment: Coupon rate Market rate Note payable $165,000 1.65% 4.70% Note term 6 years The note is due in equal annual payments of principle and interest. The company uses straight-line depreciation for book purposes. Depreciation information on the equipment: Useful life of...
On January 1, 20X1, Company XYZ started operations. The company acquired a piece of equipment by issuing a note payable on that date. The note had a below market rate of interest. Terms of the purchase of the equipment: Coupon rate Market rate Note payable $200,000 1.25% 5.10% Note term 6 years The note is due in equal annual payments of principle and interest. The company uses straight-line depreciation for book purposes. Depreciation information on the equipment: Useful life of...
21% The next three questions use the below information. Problem 1, Question 1. Company A started business on January 1, 20X1, and bought the following piece of equipment. Cost of asset $150,000 Salvage 30,000 Useful life Tax rate 20X1 estimated tax payment 1,800 Depreciation for book and tax purposes is as follows: Book Tax 20x1 40,000 100,000 20x2 1 4 0,000 20,000 20x3 40,000 20x1 income statement information: Sales 638,000 Expenses (does not include depreciation expense and tax expense) 510,000...
Questions 4 and 5 use the below fact pattern. Problem 2, Question 4. Company B acquired the following piece of equipment. Your staff accountant computed the book and tax depreciation. It is up to you to determine the deferred tax amounts. Equipment cost $50,000 Salvage 5,000 Useful life Tax rate 21% Depreciation for book and tax purposes is as follows: Book Tax 20X19 ,000 20,000 20x2 9 ,000 12,000 20X3 9,000 7,200 20X4 9,000 4,320 20X5 9,000 1,480 4) What...