Blossom Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Profits of $1070000 recognized for books in 2024 will be collected in the following years: 2025 2026 2027 Collection of Profits $174000 $374000 $522000 The enacted tax rates are: 30% for 2024, 25% for 2025, and 20% for 2026 and 2027. Taxable income is expected in all future years. What amount should be included in the December 31, 2024 balance sheet for the deferred tax liability related to the above temporary difference? $43500 $179200 $222700 $321000

Blossom Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Profits of $1070000 recognized for books in 2024 will be collected in the following years: 2025 2026 2027 Collection of Profits $174000 $374000 $522000 The enacted tax rates are: 30% for 2024, 25% for 2025, and 20% for 2026 and 2027. Taxable income is expected in all future years. What amount should be included in the December 31, 2024 balance sheet for the deferred tax liability related to the above temporary difference? $43500 $179200 $222700 $321000

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter17: Business Tax Credits And The Alternative Minimum Tax

Section: Chapter Questions

Problem 1BD

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Rhodes Corporations financial statements are shown after part f. Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions. a. What is the net operating profit after taxes (NOPAT) for 2020? b. What are the amounts of net operating working capital for both years? c. What are the amounts of total net operating capital for both years? d. What is the free cash flow for 2020? e. What is the ROIC for 2020? f. How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Rhodes Corporation: Income Statements for Year Ending December 31 (Millions of Dollars) Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
Comprehensive Colt Company reports pretax financial income of 143,000 in 2019. In addition to pretax income from continuing operations (of which revenues are 295,000), the following items are included in this pretax income: Colts taxable income totals 93,000 in 2019. The difference between the pretax financial income and the taxable income is due to the excess of tax depreciation over financial depreciation on assets used in continuing operations. At the beginning of 2019, Colt had a retained earnings balance of 310.000 and a deferred tax liability of 8,100. During 2019, Colt declared and paid dividends of 48,000. It is subject to tax rates of 15% on the first 50,000 of income and 30% on income in excess of 50,000. Based on proper interperiod tax allocation procedures, Colt has determined that its 2019 ending deferred tax liability is 14,100. Required: 1. Prepare a schedule for Colt to allocate the total 2019 income tax expense to the various components of pretax income. 2. Prepare Colts income tax journal entry at the end of 2019. 3. Prepare Colts 2019 income statement. 4. Prepare Colts 2019 statement of retained earnings. 5. Show the related income tax disclosures on Colts December 31, 2019, balance sheet.
Xenun Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Profits of $1,200,000 recognized for books in 2020 will be collected in the following years: Collection of Profits $200,000 $400,000 2021 2022 2023 $600,000 The enacted tax rate is 30% for 2020 and 2021. The enacted tax rate is 35% for 2022 and 2023. Prepared the necessary journal entries for 2020, 2021, 2022, and 2023.
Bonita Inc. reports the following pretax income (loss) for both book and tax purposes. Pretax Year Income (Loss) Tax Rate 2018 $124,000 20 % 2019 86,000 20 % 2020 (89,000 ) 25 % 2021 126,000 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, and the tax effects of the loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-half of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Sunland, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment income of $2700000 will be collected in the following years when the enacted tax rates are: Collection of Income Enacted Tax Rates 2024 $240000 25% 2025 540000 20% 2026 846000 20% 2027 1074000 15% The installment income is Sunland's only temporary difference. What amount should be reported as a deferred income tax liability in Sunland's December 31, 2024 balance sheet? $675000 ○ $615000 ○ $507300 ○ $438300
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Blossom, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment income of $3500000 will be collected in the following years when the enacted tax rates are: Collection of Income Enacted Tax Rates 2020 $400000 25% 2021 700000 20% 2022 990000 20% 2023 1410000 15% The installment income is Blossom's only temporary difference. What amount should be included in the deferred income tax liability in Blossom's December 31, 2020 balance sheet? $669500 $875000 $549500 $775000
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Cullumber Inc. reports the following pre-tax incomes (losses) for both financial reporting purposes and tax purposes: Year 2021 2022 2023 2024 Accounting Income (Loss) (a) $128,000 93,000 (300,000) 219,000 Tax Rate 25 % 25 % 30 % 30 % The tax rates listed were all enacted by the beginning of 2021. Cullumber reports under the ASPE future income taxes method. Assume that Cullumber uses a valuation allowance to account for future tax assets, and also that it is more likely than not that 25% of the carryforward benefits will not be realized. Prepare the journal entries for 2023 and 2024. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the problem.)
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