Question

Compute MV Corp. 2019 taxable income given the following info relating to its year 1 activities. Also, compute MV’s Schedule M-1 assuming that MV’s federal income tax expense for book purposes is $100,000.

• Gross profit from inventory sales of $500,000 (no book–tax differences)
• Dividends MV received from 25 percent-owned corporation of $100,000 (assume this is also MV’s pro rata share of the distributing corporation’s earnings).
• Expenses other than DRD, charitable contribution, and net operating loss (NOL), are $350,000 (no book–tax differences).
• NOL carryover from 2018 of $10,000.
• Cash charitable contribution of $120,000.

Compute MV Corp.'s 2019 taxable income given the following information relating to its year 1 activities. (Negative amou be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Description Book Income (Dr) Cr 500,000 Book-tax adjustments (Dr) Cr Taxable Income (Dr) Cr 500,000 $ 100,000 600,000 100,000 600,000 $ $ Gross profit Other income: Dividend income Gross Income Expenses: Business expenses other than DRD, CC, and NOL Federal income tax expense Total expenses before charitable contribution, NOL, and DRD (350,000) (350,000) (100,000) 100,000 (450,000) (350,000) $ 150,000 Income before charitable contribution, NOL, and DRD NOL carryover from prior year 250,000 (10,000) (10,000) $ 240,000 Taxable income for charitable contribution limitation purposes (modified taxable income) Charitable contributions (120,000) 96,000 $ Taxable income before DRD Dividends received deduction (DRD) Book/Taxable income (24,000) 216,000 (65,000) 151,000 (65,000) $175,000) $ 30,000 $196,000 $

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HELLO, ABOVE I HAVE COMPLETED WHAT I COULD FIGURE OUT. HOWEVER, IT IS STILL SAYING MY ANSWER IS NOT COMPLETED. ANY HELP WOULD BE APPRECIATED THANK YOU!!!!!!

Answer 1

Your calculation is correct you are just required to make this change in the following row

Federal income tax expense

(100,000)

100,000

0

In the column of taxable income (Dr.) Cr. you are required to insert 0.

If any further doubts, then feel free to ask.