Question
Chi Services reported taxable income of $2,200,000. An audit found that $300,000 in tax-deductible employee training costs were not deducted, and $150,000 in non-deductible entertainment
Chi Services reported taxable income of $2,200,000. An audit found that $300,000 in tax-deductible employee training costs were not deducted, and $150,000 in non-deductible entertainment expenses were included in the calculations.
Requirement: Adjust the taxable income and calculate the correct tax liability assuming a corporate tax rate of 26%. Discuss the errors found.###question_divider###
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Financial Accounting Tools for Business Decision Making
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
6th Canadian edition
1118644948, 978-1118805084, 1118805089, 978-1118644942
