0-9-3. Federal Income Taxes Required The table below shows the corporate income tax rates for 2017: U.S. Corporate Income Tax Table of the amount over- $0 Pre-tax net income over- $0 50,000 75,000 100,000 335,000 10,000,000 15,000,000 18,333,333 But not over - Taxis $50,000 15% 75,000 $ 7,500 + 25% 100,000 13,750 + 34% 335,000 22,250+ 39% 10,000,000 $113,900 + 34% 15,000,000 3,400,000+ 35% 18,333,333 5,150,000 + 38% 35% 50,000 75,000 100,000 335,000 10,000,000 15,000,000 General ledger account numbers for the journal entry are: A/C #40700 (Federal Income Tax Expense) and A/C #20700 (Federal Income Taxes Payable). Show your calculation below. Cost of Goods Sold QuickBooks automatically debits cost of goods sold and credits inventory for the product cost for each sale. The inventory account is also automatically updated for inventory purchases and purchases returns. Therefore, the QuickBooks data does not include the following accounts from the SUA: A/C #30500 (Purchases) and A/C#30600 (Purchase Returns and Allowance). Waren treats purchase discounts taken and freight-in as a part of cost of goods sold, but records them in separate accounts during the accounting period. Therefore, these two accounts must be closed to A/C#30400 (Cost of Goods Sold): A/C 30700 (Purchases Discounts Taken) and A/C #30800 (Freight-In). Before preparing the general journal entry, determine the balance in each account being closed to cost of goods sold. Determine the balance in the accounts to be closed by examining the income statement. Federal Income Taxes Recall from the SUA that corporate income tax rate brackets applicable to Waren for 2017 are: 15% of the first $50,000 of pre-tax income, plus 25% of the next $25,000, plus 34% of the next $25,000, plus 39% of the next $235,000. The remaining tax brackets are not listed here because they aren't applicable to Waren's level of pre-tax income. General ledger account numbers for the journal entry are: A/C W40700 (Federal Income Tax Expense) and A/C W20700 (Federal Income Taxes Payable). Either enter the correct amount on the online grading page of the Armond Dalton Resources website or show your calculation on the Chapter 9 pages of the Student Problems & Cases book (consult your instructor). . After all other adjusting entries are recorded, determine 2017 pre-tax income by examining the 2017 income statement from the Memorized tab in the Report Center. Do not be concerned if your amount is slightly different from the SUA amount for federal income taxes. The minor payroll differences will affect the calculation slightly. S Waren Sports Supply Trial Balance As of December 31, 2017 Credit Dec 31, 17 Debit 93.291.29 48.149.00 1,879.55 191,967.00 24,000.00 0.00 331,731.40 116,583.14 7.952.01 0.00 0.00 1.437.00 110.43 18.66 2.229.32 54,837.13 106.85 60,000.00 0.00 10100 . Cash 10200. Accounts Receivable 10300. Allowance for Doubtful Acets. 10400 Inventory 10600. Marketable Securities 12000 . Undeposited Funds 10800 - Fixed Assets 10900 - Accumulated Depreciation 20100. Accounts Payable *Sales Tax Payable Payroll Liabilities 20300. Federal Income Tax Withheld 20400 - State Unemployment Taxes Pay. 20500 . Fed. Unemployment Taxes Pay. 20600 - FICA Taxes Payable 20700 - Federal Income Taxes Payable 20900. Interest Payable 21000 . Notes Payable Opening Bal Equity 26000 . Common Stock 29000 . Retained Earnings 30100. Sales 30200. Sales Returns and Allowances 30300. Sales Discounts Taken 31200. Miscellaneous Revenue 30400. Cost of Goods Sold 30700 . Purchases Discounts Taken 30800. Freight-in 40100. Rent Expense 40200. Advertising Expense 40300. Office Supplies Expense 40400 . Depreciation Expense 40500. Wages and Salaries Expense 40600. Payroll Tax Expense 40700 . Federal Income Tax Expense 40800. Interest Expense 40900. Bad Debt Expense 41000. Other Operating Expense 225,000.00 90,264.99 1.590,883.00 61,106.00 15,405.82 825.00 1,026,379.96 0.00 0.00 57,600.00 22,275.00 5,664.91 35,023.64 140,663.35 11,611.24 54,837.13 106.85 3,028.74 29,285.75 2,152,127.08 2,152,127.08 TOTAL Check Figures Waren Sports Supply Trial Balance As of December 31, 2017 PASSIDE Credit Dec 31, 17 Debit 93,291.29 48,149.00 3,250.81 192,501.00 24,000.00 0.00 331,731.40 81,559.50 7.952.01 0.00 0.00 1,437.00 110.43 18.66 2,229.32 TAULU 0.00 60,000.00 10100 Cash 10200 - Accounts Receivable 10300. Allowance for Doubtful Accts 10400 - Inventory 10600 - Marketable Securities 12000 . Undeposited Funds 10800 - Fixed Assets 10900. Accumulated Depreciation 20100 - Accounts Payable "Sales Tax Payable Payroll Liabilities 20300 . Federal Income Tax Withheld 20400. State Unemployment Taxes Pay. 20500. Fed. Unemployment Taxes Pay. 20600. FICA Taxes Payable 20700 . Federal Income Taxes Payable 21000. Notes Payable Opening Bal Equity 26000. Common Stock 29000 . Retained Earnings 30100 - Sales 30200. Sales Returns and Allowances 30300. Sales Discounts Taken 31200. Miscellaneous Revenue 30400. Cost of Goods Sold 30700 . Purchases Discounts Taken 30800 - Freight-in 40100. Rent Expense 40200. Advertising Expense 40300. Office Supplies Expense 40500. Wages and Salaries Expense 40600. Payroll Tax Expense 40900. Bad Debt Expense 41000. Other Operating Expense 0.00 225,000.00 90,264.99 1,590,883.00 61,106.00 15,405.82 825.00 1,017.894.00 16,554.48 24,506.44 57,600.00 22,275.00 5,664.91 140.663.35 11.611.24 4.400.00 29.285.75 o to 1 0 0 0 0 0 Dovou TOTAL 2,080,085.20 2,080,085.20 9-22 Chapter 9: Option A 0-9-3. Federal Income Taxes Required The table below shows the corporate income tax rates for 2017: U.S. Corporate Income Tax Table of the amount over- $0 Pre-tax net income over- $0 50,000 75,000 100,000 335,000 10,000,000 15,000,000 18,333,333 But not over - Taxis $50,000 15% 75,000 $ 7,500 + 25% 100,000 13,750 + 34% 335,000 22,250+ 39% 10,000,000 $113,900 + 34% 15,000,000 3,400,000+ 35% 18,333,333 5,150,000 + 38% 35% 50,000 75,000 100,000 335,000 10,000,000 15,000,000 General ledger account numbers for the journal entry are: A/C #40700 (Federal Income Tax Expense) and A/C #20700 (Federal Income Taxes Payable). Show your calculation below. Cost of Goods Sold QuickBooks automatically debits cost of goods sold and credits inventory for the product cost for each sale. The inventory account is also automatically updated for inventory purchases and purchases returns. Therefore, the QuickBooks data does not include the following accounts from the SUA: A/C #30500 (Purchases) and A/C#30600 (Purchase Returns and Allowance). Waren treats purchase discounts taken and freight-in as a part of cost of goods sold, but records them in separate accounts during the accounting period. Therefore, these two accounts must be closed to A/C#30400 (Cost of Goods Sold): A/C 30700 (Purchases Discounts Taken) and A/C #30800 (Freight-In). Before preparing the general journal entry, determine the balance in each account being closed to cost of goods sold. Determine the balance in the accounts to be closed by examining the income statement. Federal Income Taxes Recall from the SUA that corporate income tax rate brackets applicable to Waren for 2017 are: 15% of the first $50,000 of pre-tax income, plus 25% of the next $25,000, plus 34% of the next $25,000, plus 39% of the next $235,000. The remaining tax brackets are not listed here because they aren't applicable to Waren's level of pre-tax income. General ledger account numbers for the journal entry are: A/C W40700 (Federal Income Tax Expense) and A/C W20700 (Federal Income Taxes Payable). Either enter the correct amount on the online grading page of the Armond Dalton Resources website or show your calculation on the Chapter 9 pages of the Student Problems & Cases book (consult your instructor). . After all other adjusting entries are recorded, determine 2017 pre-tax income by examining the 2017 income statement from the Memorized tab in the Report Center. Do not be concerned if your amount is slightly different from the SUA amount for federal income taxes. The minor payroll differences will affect the calculation slightly. S Waren Sports Supply Trial Balance As of December 31, 2017 Credit Dec 31, 17 Debit 93.291.29 48.149.00 1,879.55 191,967.00 24,000.00 0.00 331,731.40 116,583.14 7.952.01 0.00 0.00 1.437.00 110.43 18.66 2.229.32 54,837.13 106.85 60,000.00 0.00 10100 . Cash 10200. Accounts Receivable 10300. Allowance for Doubtful Acets. 10400 Inventory 10600. Marketable Securities 12000 . Undeposited Funds 10800 - Fixed Assets 10900 - Accumulated Depreciation 20100. Accounts Payable *Sales Tax Payable Payroll Liabilities 20300. Federal Income Tax Withheld 20400 - State Unemployment Taxes Pay. 20500 . Fed. Unemployment Taxes Pay. 20600 - FICA Taxes Payable 20700 - Federal Income Taxes Payable 20900. Interest Payable 21000 . Notes Payable Opening Bal Equity 26000 . Common Stock 29000 . Retained Earnings 30100. Sales 30200. Sales Returns and Allowances 30300. Sales Discounts Taken 31200. Miscellaneous Revenue 30400. Cost of Goods Sold 30700 . Purchases Discounts Taken 30800. Freight-in 40100. Rent Expense 40200. Advertising Expense 40300. Office Supplies Expense 40400 . Depreciation Expense 40500. Wages and Salaries Expense 40600. Payroll Tax Expense 40700 . Federal Income Tax Expense 40800. Interest Expense 40900. Bad Debt Expense 41000. Other Operating Expense 225,000.00 90,264.99 1.590,883.00 61,106.00 15,405.82 825.00 1,026,379.96 0.00 0.00 57,600.00 22,275.00 5,664.91 35,023.64 140,663.35 11,611.24 54,837.13 106.85 3,028.74 29,285.75 2,152,127.08 2,152,127.08 TOTAL Check Figures Waren Sports Supply Trial Balance As of December 31, 2017 PASSIDE Credit Dec 31, 17 Debit 93,291.29 48,149.00 3,250.81 192,501.00 24,000.00 0.00 331,731.40 81,559.50 7.952.01 0.00 0.00 1,437.00 110.43 18.66 2,229.32 TAULU 0.00 60,000.00 10100 Cash 10200 - Accounts Receivable 10300. Allowance for Doubtful Accts 10400 - Inventory 10600 - Marketable Securities 12000 . Undeposited Funds 10800 - Fixed Assets 10900. Accumulated Depreciation 20100 - Accounts Payable "Sales Tax Payable Payroll Liabilities 20300 . Federal Income Tax Withheld 20400. State Unemployment Taxes Pay. 20500. Fed. Unemployment Taxes Pay. 20600. FICA Taxes Payable 20700 . Federal Income Taxes Payable 21000. Notes Payable Opening Bal Equity 26000. Common Stock 29000 . Retained Earnings 30100 - Sales 30200. Sales Returns and Allowances 30300. Sales Discounts Taken 31200. Miscellaneous Revenue 30400. Cost of Goods Sold 30700 . Purchases Discounts Taken 30800 - Freight-in 40100. Rent Expense 40200. Advertising Expense 40300. Office Supplies Expense 40500. Wages and Salaries Expense 40600. Payroll Tax Expense 40900. Bad Debt Expense 41000. Other Operating Expense 0.00 225,000.00 90,264.99 1,590,883.00 61,106.00 15,405.82 825.00 1,017.894.00 16,554.48 24,506.44 57,600.00 22,275.00 5,664.91 140.663.35 11.611.24 4.400.00 29.285.75 o to 1 0 0 0 0 0 Dovou TOTAL 2,080,085.20 2,080,085.20 9-22 Chapter 9: Option A