Homework Answers
| (1) Journal Entry for 2020 | |||||
| $ | $ | ||||
| Deferred Tax Assets | 1,00,000 | ||||
| Income Tax Expenses | 1,00,000 | ||||
| WN: As loss of $ 5,00,000 in 2020 and the same shall be realised in future years. | |||||
| So Deferred Tax Assets @ 20% of $ 5,00,000 to be provided, which is equal to | |||||
| $ 1,00,000. | |||||
| (2) If there is no possibility of realisation of realisation of loss in future, then | |||||
| no deferred tax arises. | |||||
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1. Ralston Inc. incurred a net operating loss of $500,000 in 2020. Combined income for 2018...
3. The Thomas Corporation, a U.S. company, has had no permanent or temporary differences since it...
3. The Thomas Corporation, a U.S. company, has had no permanent or temporary differences since it began operations. Information regarding taxable income and taxes paid is as follows: YEAR Taxable income Tax Rate (Loss) 1 $60,000 40% 2 $100,000 40% 3 $80,000 35% 4 $160,000 35% 5 ($400,000) 30% The tax rate enacted for Year 6 and subsequent years is 25%. REQUIRED: Prepare the income tax journal entries for Thomas Corporation for years 1-5. 4. Now assume that it is...
P18.12 Carly Inc. reported the following accounting income (loss) and related tax rates during the years 2015 to 2021: Year Accounting Income (Loss) Tax Rate 2015 $ 70,000 25% 2016 25,000 25% 2017 60,000 25% 2018 80,000 30% 2019 (21
P18.12 Carly Inc. reported the following accounting income (loss) and related tax rates during the years 2015 to 2021:YearAccounting Income (Loss)Tax Rate2015$ 70,000 25%2016 25,000 25%2017 60,000 25%2018 80,000 30%2019(210,000)35%2020 70,000 30%2021 90,000 25%Accounting income (loss) and taxable income (loss) were the same for all years since Carly began business. The tax rates from 2018 to 2021 were enacted in 2018. Assume Carly Inc. follows ASPE for all parts of this question, except when asked about the effect of reporting under...
Question 3 View Policies Current Attempt In Progress Metlock Inc. reports the following pretax income (loss) for...
Question 3 View Policies Current Attempt In Progress Metlock Inc. reports the following pretax income (loss) for both book and tax purposes. 20% Pretax Year Income (Loss Tax Rate 2018 $118,000 2019 98,000 20% 2020 (299,000) 25 % 2021 117,000 25 % The tax rates listed were all enacted by the beginning of 2018. Prepare the journal entries for years 2018-2021 to record income tax expense (benefit) and income taxes payable (refundable), and the tax effects of the loss carryforward,...
The pretax financial income (or loss) figures for Vaughn Company are as follows. 2015 $149,000 2016...
The pretax financial income (or loss) figures for Vaughn Company
are as follows. 2015 $149,000 2016 240,000 2017 75,000 2018
(149,000 ) 2019 (371,000 ) 2020 119,000 2021 105,000 Pretax
financial income (or loss) and taxable income (loss) were the same
for all years involved. Assume a 25% tax rate for 2015 and 2016 and
a 20% tax rate for the remaining years. Prepare the journal entries
for the years 2017 to 2021 to record income tax expense and the...
During 2018, its first year of operations, Baginski Steel Corporation reported a net operating loss of...
During 2018, its first year of operations, Baginski Steel Corporation reported a net operating loss of $460,000 for financial reporting and tax purposes. The enacted tax rate is 30%. Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests future taxable income sufficient to benefit from future deductible amounts from the net operating loss carryforward. 2. Show the lower portion of the 2018 income statement that...
Question No. 2 Income Taxes The pretax financial income or loss figures for Ellensburg Inc. are...
Question No. 2 Income Taxes The pretax financial income or loss figures for Ellensburg Inc. are as follows: Year 2018 2019 2020 Income (loss) (100,000) 100,000 100,000 Tax Rate 20 20 20 Required: Prepare the journal entries for the years 2018-2020 assuming that Ellensburg uses the carryforward provision.
Pina Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes....
Pina Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. (Assume the carryback provision is used for a net operating loss.) Year Pretax Income (Loss) Tax Rate 2015 $118,000 34 % 2016 90,000 34 % 2017 (296,000 ) 38 % 2018 229,000 38 % The tax rates listed were all enacted by the beginning of 2015. Collapse question part (a) Prepare the journal entries for the years 2015–2018 to record income tax expense (benefit)...
Buffalo reported the following pretax financial income (loss) for the years 2015-2019. 2015 2016 2017 2018...
Buffalo reported the following pretax financial income (loss) for the years 2015-2019. 2015 2016 2017 2018 2019 $248,000 379,000 96,000 (535,000) 186,000 Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2015 and 2016, and 40% for 2017-2019. Assume the carryback provision is used first for net operating losses. Your answer is partially correct. Try again. Prepare the journal entries for the years 2017-2019 to record income...
Exercise 19-23 Pearl Inc. reports the following pretax income (loss) for both financial reporting purposes and...
Exercise 19-23 Pearl Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Assume the carryback provision is used for a net operating loss.) Pretax Income (Loss) Year Tax Rate 2015 2016 2017 2018 $113,000 84,000 (270,000) 231,000 The tax rates listed were all enacted by the beginning of 2015. Prepare the journal entries for the years 2015-2018 to record income tax expense (benefit) and income taxes payable (refundable) and the tax effects of the...
Alto Company incurs a net operating loss in 2019 of $4,000,000. The loss is the same...
Alto Company incurs a net operating loss in 2019 of $4,000,000. The loss is the same for pretax accounting income and for tax purposes (no temporary or permanent differences). Under income tax law, losses may only be carried forward to later years (carrybacks are not permitted). Alto incurs pretax accounting and taxable income of $6,000,000 in 2020 and all of the loss carryforward is used to offset some of the 2020 income on the tax return that year. Alto’s income...
3. The Thomas Corporation, a U.S. company, has had no permanent or temporary differences since it began operations. Information regarding taxable income and taxes paid is as follows: YEAR Taxable income Tax Rate (Loss) 1 $60,000 40% 2 $100,000 40% 3 $80,000 35% 4 $160,000 35% 5 ($400,000) 30% The tax rate enacted for Year 6 and subsequent years is 25%. REQUIRED: Prepare the income tax journal entries for Thomas Corporation for years 1-5. 4. Now assume that it is...
P18.12 Carly Inc. reported the following accounting income (loss) and related tax rates during the years 2015 to 2021:YearAccounting Income (Loss)Tax Rate2015$ 70,000 25%2016 25,000 25%2017 60,000 25%2018 80,000 30%2019(210,000)35%2020 70,000 30%2021 90,000 25%Accounting income (loss) and taxable income (loss) were the same for all years since Carly began business. The tax rates from 2018 to 2021 were enacted in 2018. Assume Carly Inc. follows ASPE for all parts of this question, except when asked about the effect of reporting under...
Question 3 View Policies Current Attempt In Progress Metlock Inc. reports the following pretax income (loss) for both book and tax purposes. 20% Pretax Year Income (Loss Tax Rate 2018 $118,000 2019 98,000 20% 2020 (299,000) 25 % 2021 117,000 25 % The tax rates listed were all enacted by the beginning of 2018. Prepare the journal entries for years 2018-2021 to record income tax expense (benefit) and income taxes payable (refundable), and the tax effects of the loss carryforward,...
The pretax financial income (or loss) figures for Vaughn Company
are as follows. 2015 $149,000 2016 240,000 2017 75,000 2018
(149,000 ) 2019 (371,000 ) 2020 119,000 2021 105,000 Pretax
financial income (or loss) and taxable income (loss) were the same
for all years involved. Assume a 25% tax rate for 2015 and 2016 and
a 20% tax rate for the remaining years. Prepare the journal entries
for the years 2017 to 2021 to record income tax expense and the...
During 2018, its first year of operations, Baginski Steel Corporation reported a net operating loss of $460,000 for financial reporting and tax purposes. The enacted tax rate is 30%. Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss. Assume the weight of available evidence suggests future taxable income sufficient to benefit from future deductible amounts from the net operating loss carryforward. 2. Show the lower portion of the 2018 income statement that...
Question No. 2 Income Taxes The pretax financial income or loss figures for Ellensburg Inc. are as follows: Year 2018 2019 2020 Income (loss) (100,000) 100,000 100,000 Tax Rate 20 20 20 Required: Prepare the journal entries for the years 2018-2020 assuming that Ellensburg uses the carryforward provision.
Buffalo reported the following pretax financial income (loss) for the years 2015-2019. 2015 2016 2017 2018 2019 $248,000 379,000 96,000 (535,000) 186,000 Pretax financial income (loss) and taxable income (loss) were the same for all years involved. The enacted tax rate was 34% for 2015 and 2016, and 40% for 2017-2019. Assume the carryback provision is used first for net operating losses. Your answer is partially correct. Try again. Prepare the journal entries for the years 2017-2019 to record income...
Exercise 19-23 Pearl Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Assume the carryback provision is used for a net operating loss.) Pretax Income (Loss) Year Tax Rate 2015 2016 2017 2018 $113,000 84,000 (270,000) 231,000 The tax rates listed were all enacted by the beginning of 2015. Prepare the journal entries for the years 2015-2018 to record income tax expense (benefit) and income taxes payable (refundable) and the tax effects of the...
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