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ABC Inc. is an accrual basis calendar year taxpayer. In 2020 ABC reported 11,000,000 of net income before tax on its financial statements prepared in
ABC Inc. is an accrual basis calendar year taxpayer. In 2020 ABC reported 11,000,000 of net income before tax on its financial statements prepared in accordance with GAAP. ABC's records also reveal the following:
- ABC spent $380,000 on travel accommodations for clients
- ABC paid $140,000 for local fines issued to its company vehicles/drivers
- ABC deducted $4,500 of company costs for a new business line that began its operations in 2020
- ABC deducted capital losses of $250,000 in determining its net income under GAAP. ABC also included capital gains of $50,000 in determining its net income under GAAP.
- Bad debt expense for GAAP as determined under the allowance method was $450,000. During 2020 ABC identified and wrote off $630,000 of Accounts Rec..
- ABC acquired purchased goodwill of $600.000 on July 7, 2016. There was no impairment to goodwill during 2020.
What would a book reconciliation look like to be able to compute ABC's taxable income?
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