Question
At the beginning of 2015; Elephant, Inc. had a deferred tax asset of $10,000 and a deferred tax liability of $15,000. Pre-tax accounting income for
At the beginning of 2015; Elephant, Inc. had a deferred tax asset of $10,000 and a deferred tax liability of $15,000. Pre-tax accounting income for 2015 was $750,000 and the enacted tax rate is 40%. The following items are included in Elephants pre-tax income:
Interest income from municipal bonds | $ 60,000 |
Accrued warranty costs, estimated to be paid in 2016 | $130,000 |
Operating loss carryforward | $ 95,000 |
Installment sales revenue, will be collected in 2016 | $ 65,000 |
Prepaid rent expense, will be used in 2016 | $ 30,000 |
76. What is Elephant, Inc.s taxable income for 2015?
a. $ 750,000
b. $ 630,000
c. $ 870,000
d. $1,130,000
why choose B
78. The ending balance in Elephant, Incs deferred tax liability at December 31, 2015 is
a. $23,000
b. $38,000
c. $26,000
d. $78,000
why choose B
81. Based on the following information, compute 2015 taxable income for South Co. assuming that its pre-tax accounting income for the year ended December 31, 2015 is $345,000.
Future taxable
Temporary difference (deductible) amount
Installment sales | $288,000 |
Depreciation | $ 90,000 |
Unearned rent | ($300,000) |
a. $423,000
b. $267,000
c. $723,000
d. $333,000
why choose B
82. Fleming Company has the following cumulative taxable temporary differences:
12/31/15 12/31/14
$1,280,000 $1,800,000
The tax rate enacted for 2015 is 40%, while the tax rate enacted for future years is 30%. Taxable income for 2015 is $3,200,000 and there are no permanent differences. Flemings pretax financial income for 2015 is:
a. $1,920,000
b. $2,680,000
c. $3,460,000
d. $4,480,000
why choose B
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started