1.Tim Construction Co. began operations in 2014. Construction activity for 2014 is shown below. Tim uses the percentage of completion method. Contract Contract Price Billings Through 12/31/14 Collections Through 12/31/14 Costs to 12/31/14 Estimated Costs to Complete 1 $5,200,000 $3,500,000 $2,600,000 3,000,000 1,000,000 2 3.600,000 1,500,000 1,000,000 820,000 1,880,000 3 3,300,000 1,900,000 1,800,000 2,250,000 1,200,000 Which of the following should be shown on the Balance Sheet on Dec 31, 2014 related to Contract 1? (Points : 5) $1,200,000 Inventory $3,500,000 Current liability $1,400,000 Inventory $4,900,000 Current liability

2. (TCO B) K Corporation's partial income statement after its first year of operations is as follows: Income before Income Taxes $3,750,000 Income Tax expense Current $1,035,000 Deferred 67,500 __________ 1,102,500 __________ Net Income $2,647,500 K uses the straight-line method of depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The amount charged to depreciation expense on its books this year was $1,200,000. No other differences existed between book income and taxable income except for the amount of depreciation. Assuming a 30% tax rate, what amount was deducted for depreciation on the corporation's tax return for the current year? (Points : 5)

$1,200,000 $1,425,000 $1,500,000 $1,800,000