Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Corporation (the Company) has historically filed its federal and state income tax returns on the cash method of accounting. For the year ended December 31,

image text in transcribed
Corporation (the Company) has historically filed its federal and state income tax returns on the cash method of accounting. For the year ended December 31, 2021, management has decided to change its method of accounting to the accrual method. The Company's trial balance, as of and for the year ended December 31, 2021, is as follows. Trial Balance 12.31.21 Debit Credit 25,000 230,000 1,750,000 Cash Accounts receivable Equipment Accumulated depreciation Accounts payable Notes payable bank Common stock Retained earnings (deficit) Sales Expenses 1,750,000 45,000 20,000 5.000 1.315,000 4,250,000 2.750,000 Totals 6,070,000 6,070,000 3. Indicate the amount of the adjustment (if any) that needs to be included in the Company's tax returns for the years 2021; 2022; 2023; 2024; and 2025 4. Indicate by reference to a specific line number on form 1120 the appropriate placement of the adjustment on the Company's 2021 federal form 1120. a Corporation (the Company) has historically filed its federal and state income tax returns on the cash method of accounting. For the year ended December 31, 2021, management has decided to change its method of accounting to the accrual method. The Company's trial balance, as of and for the year ended December 31, 2021, is as follows. Trial Balance 12.31.21 Debit Credit 25,000 230,000 1,750,000 Cash Accounts receivable Equipment Accumulated depreciation Accounts payable Notes payable bank Common stock Retained earnings (deficit) Sales Expenses 1,750,000 45,000 20,000 5.000 1.315,000 4,250,000 2.750,000 Totals 6,070,000 6,070,000 3. Indicate the amount of the adjustment (if any) that needs to be included in the Company's tax returns for the years 2021; 2022; 2023; 2024; and 2025 4. Indicate by reference to a specific line number on form 1120 the appropriate placement of the adjustment on the Company's 2021 federal form 1120. a

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Living Off The State A Critical Guide To UK Royal Finance

Authors: Jon Temple

1st Edition

0955831113, 9780955831119

More Books

Students also viewed these Finance questions