Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Exercise 16- Temporary difference; taxable income given Stancil Industries reports pretax accounting income of $80 million, but due to a single LOI6-ITeat: E 16-1 temporary

image text in transcribed
Exercise 16- Temporary difference; taxable income given Stancil Industries reports pretax accounting income of $80 million, but due to a single LOI6-ITeat: E 16-1 temporary difference, taxable income is only $50 million. At the beginning of the year, no temporary differences existed Required: Assuming a tax rate of 35%, prepare the appropriate journal entry to record Stancil's income taxes. xercise 16-2 mporany ference; income In 2016, Lambert Services collected rent revenue for 2017 tenant occupancy. For income tax reporting, the rent is taxed when collected. For financial statement reporting, the rent is recognized as income in the period eaned. The unearned portion of the rent collected in 2016 s payable given 16-2 amounted to $90,000 at December 31, 2016. Lambert had no temporary differences at the : E 16-4 beginning of the year. Required: Assuming an income tax rate of 40%, and that the 2016 income tax payable is $285,000, prepare the journal entry to record income taxes for 2016. xercise 16-3 At the end of 2015, Mathis Industries had a deferred tax asset account with a balance of $120 eferred tax asset; million attributable to a temporary book-tax difference of $300 million in a liability for sable income ven; previous lance in estimated expenses. At the end of 2016, the temporary difference is $280 million. Mathis has no other temporary differences. Taxable income for 2016 is $720 million and the tax rate is luation 40%. Mathis has a valuation allowance of $40 million for the deferred tax asset at the beginning of 16-2 LO163 2016. st: E 16-11 Required: 1. Prepare the journal entry(s) to record Mathis's income taxes for 2016 assuming it is more likely than not" that the deferred tax asset will be realized. 2. Prepare the journal entry(s) to record Mathis's income taxes for 2016 assuming it is more likely than not" that one-half of the deferred tax asset will not ultimately be realized Exercise 16-4 Multiple differences; calculate taxable income LO16-1 LO16-4 Text: E 16-13 Fessler Transport began operations in January 2016, and purchased a delivery truck for $160,000. Fessler plans to use straight-line depreciation over a four-year expected useful life for financial reporting purposes. For tax purposes, the deduction is 50% of cost in 2016, 30% in 2017 and 20% in 2018. Pretax accounting income for 2016 was $900,000, which includes interest revenue of $ 160,000 from municipal bonds. The enacted tax rate is 40%. Required: Assuming no differences between accounting income and taxable income other than those described above: Required: 1. Prepare the journal entry to record income taxes in 2016 2. What is Fessler's 2016 net income

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

Step: 3

blur-text-image

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

Advanced Accounting

Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik

10th edition

0-07-794127-6, 978-0-07-79412, 978-0077431808

Students also viewed these Accounting questions