Question 1 At the end of Year 6, South Co.'s tax department estimates that they will...
Question 1
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At the end of Year 6, South Co.'s tax department estimates that they will have future taxable income of $288,000 due to installment sales and $90,000 due to depreciation differences. They also estimates that they will have future deducations of $300,000 due to unearned rent. Assuming that its pre-tax accounting income for the year ended December 31, Year 6 is $345,000, compute Year 6 taxable income for South Co.
Homework Answers
SOLUTION:
| PRE-TEXT ACCOUNTING INCOME | $345,000 |
| LESS:INSTALMENT SALES | 288000 |
| DEPRECIATION | 90000 |
| ADD:UNEARNED RENT | 300000 |
| TAXABLE INCOME FOR YEAR 6 | $267,000 |
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Question 1
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