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On January 1, 2010, Ameen Company purchased a building for $36 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax
On January 1, 2010, Ameen Company purchased a building for $36 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax reporting. At December 31, 2012, the carrying value of the building was $30 million and its tax basis was $20 million. At December 31, 2013, the carrying value of the building was $28 million and its tax basis was $13 million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2013 was $45 million.
- Prepare the appropriate journal entry to record Ameen's 2013 income taxes (current income tax expense and deferred income tax expense). Assume an income tax rate of 40%.
- What is Ameen's 2013 net income
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