Partil: Problems. (Total2 problems) 1. Hopkins Co. is a cash basis taxpayer and reports pretax financial income of $600,000 for 2020. Three items have caused taxable income to be different from pretax financial income: (1) The company is involved in a lawsuit and has accrued a related liability of $120,000. They expect to pay and fully settle the lawsuit in 2021. (2) One customer, Cunningham Inc., purchased goods from Hopkins. Hopkins has recognized the total purchase on the book and will collect the outstanding payment in the next three years, S70,000, 550,000, and $30,000, respectively. (3) Hopkins carries a life insurance policy on key officers and had paid $8,000 premium in 2020 to keep the coverage. Income tax rate is 20% for all years. Instructions: (a) Compute the amount of taxable income for 2020. (b) Prepare the journal entry to record income tax expense, deferred Income taxes, and income taxes payable for 2020. (c) In 2021, Hopkins' taxable income is $500,000. There are no new differences. Prepare Journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2021. 2. The accountant for Barton Inc. has developed the following Information for the company's defined benefit pension plan for 2020: Service cost $90,000 Actual return on plan assets 65,000 Annual contribution to the plan 184,000 Amortization of prior service cost 25,000 Benefits paid to retirees 12,000 Settlement rate 9% Expected rate of return on plan assets 10% On 12/31/2019, the projected benefit obligation amounted to $800,000, the accumulated OCI (PSC) was $125,000, and the fair value of plan assets was $550,000 Instructions (a) Using the above information, complete the pension work sheet for 2020. (b) Prepare the journal entry to reflect the accounting for the company's pension plan for the year ending December 31, 2020. 1. Hopkins Co. is a cash basis taxpayer and reports pretax financial income of $600,000 for 2020. Three items have caused taxable income to be different from pretax financial income: (1) The company is involved in a lawsuit and has accrued a related liability of $120,000. They expect to pay and fully settle the lawsuit in 2021. (2) One customer, Cunningham Inc., purchased goods from Hopkins. Hopkins has recognized the total purchase on the book and will collect the outstanding payment in the next three years, S70,000, $50,000, and $30,000, respectively. (3) Hopkins carries a life insurance policy on key officers and had paid $8,000 premium in 2020 to keep the coverage. Income tax rate is 20% for all years, Instructions: (a) Compute the amount of taxable income for 2020. (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (C) In 2021, Hopkins' taxable income is $500,000. There are no new differences. Prepare journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2021. 2. The accountant for Barton Inc. has developed the following information for the company's defined benefit pension plan for 2020: Service cost $90,000 Actual return on plan assets 65,000 Annual contribution to the plan 184,000 Amortization of prior service cost 25,000 Benefits paid to retirees 12.000 Settlement rate 9% Expected rate of return on plan assets 10% On 12/31/2019 the projected benefit obligation amounted to $800,000, the accumulated OCH (PSC) was $125.000 and the fair value of plan assets was $550,000 Instructions (a) Using the above information, complete the pension work sheet for 2020 (6) Prepare the journal entry to reflect the accounting for the company's pension plan for the year ending December 31, 2020 Partil: Problems. (Total2 problems) 1. Hopkins Co. is a cash basis taxpayer and reports pretax financial income of $600,000 for 2020. Three items have caused taxable income to be different from pretax financial income: (1) The company is involved in a lawsuit and has accrued a related liability of $120,000. They expect to pay and fully settle the lawsuit in 2021. (2) One customer, Cunningham Inc., purchased goods from Hopkins. Hopkins has recognized the total purchase on the book and will collect the outstanding payment in the next three years, S70,000, 550,000, and $30,000, respectively. (3) Hopkins carries a life insurance policy on key officers and had paid $8,000 premium in 2020 to keep the coverage. Income tax rate is 20% for all years. Instructions: (a) Compute the amount of taxable income for 2020. (b) Prepare the journal entry to record income tax expense, deferred Income taxes, and income taxes payable for 2020. (c) In 2021, Hopkins' taxable income is $500,000. There are no new differences. Prepare Journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2021. 2. The accountant for Barton Inc. has developed the following Information for the company's defined benefit pension plan for 2020: Service cost $90,000 Actual return on plan assets 65,000 Annual contribution to the plan 184,000 Amortization of prior service cost 25,000 Benefits paid to retirees 12,000 Settlement rate 9% Expected rate of return on plan assets 10% On 12/31/2019, the projected benefit obligation amounted to $800,000, the accumulated OCI (PSC) was $125,000, and the fair value of plan assets was $550,000 Instructions (a) Using the above information, complete the pension work sheet for 2020. (b) Prepare the journal entry to reflect the accounting for the company's pension plan for the year ending December 31, 2020. 1. Hopkins Co. is a cash basis taxpayer and reports pretax financial income of $600,000 for 2020. Three items have caused taxable income to be different from pretax financial income: (1) The company is involved in a lawsuit and has accrued a related liability of $120,000. They expect to pay and fully settle the lawsuit in 2021. (2) One customer, Cunningham Inc., purchased goods from Hopkins. Hopkins has recognized the total purchase on the book and will collect the outstanding payment in the next three years, S70,000, $50,000, and $30,000, respectively. (3) Hopkins carries a life insurance policy on key officers and had paid $8,000 premium in 2020 to keep the coverage. Income tax rate is 20% for all years, Instructions: (a) Compute the amount of taxable income for 2020. (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (C) In 2021, Hopkins' taxable income is $500,000. There are no new differences. Prepare journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2021. 2. The accountant for Barton Inc. has developed the following information for the company's defined benefit pension plan for 2020: Service cost $90,000 Actual return on plan assets 65,000 Annual contribution to the plan 184,000 Amortization of prior service cost 25,000 Benefits paid to retirees 12.000 Settlement rate 9% Expected rate of return on plan assets 10% On 12/31/2019 the projected benefit obligation amounted to $800,000, the accumulated OCH (PSC) was $125.000 and the fair value of plan assets was $550,000 Instructions (a) Using the above information, complete the pension work sheet for 2020 (6) Prepare the journal entry to reflect the accounting for the company's pension plan for the year ending December 31, 2020