12/31/15 12/31/14

$2,700,000 $1,920,000

The tax rate enacted for 2015 is 40%, while the tax rate enacted for future years is 30%. Taxable income for 2015 is $4,800,000 and there are no permanent differences. Ferguson's pretax financial income for 2015 is

a. $7,500,000.

b. $5,580,000.

c. $4,020,000.

d. $2,100,000.

why B

Rowen, Inc. had pre-tax accounting income of $1,800,000 and a tax rate of 40% in 2015, its first year of operations. During 2015 the company had the following transactions:

Received rent from Jane, Co. for 2016	$64,000
Municipal bond income	$80,000
Depreciation for tax purposes in excess of book depreciation	$40,000
Installment sales revenue to be collected in 2016	$108,000

79. For 2015, what is the amount of income taxes payable for Rowen, Inc?

a. $603,200

b. $654,400

c. $686,400

d. $772,800

why B

Larsen Corporation reported $100,000 in revenues in its 2014 financial statements, of which $33,000 will not be included in the tax return until 2015. The enacted tax rate is 40% for 2014 and 35% for 2015. What amount should Larsen report for deferred income tax liability in its balance sheet at December 31, 2014?

a. $11,550

b. $13,200

c. $14,700

d. $16,800

why A