QUESTION 2

1. Meeks Corp. historically paid taxes at a rate of 30%. In early 20X5 (after Meeks December 31, 20X4, fiscal year-end financial statements had been finalized), the government announced an increase in the tax rate to 35%, effective January 1, 20X5. Pertinent information is as follows:

   • As at December 31, 20X4, the net book value of Meeks fixed assets was $200,000, and the UCC was $150,000.
   • As at December 31, 20X4, the provision for warranties was $20,000.
   • For the year ended December 31, 20X5, Meeks accounting income before taxes and accounting income subject to tax were $180,000, and its taxable income was $170,000.

   What was the total amount of tax expense reported on Meeks statement of comprehensive income for the year ended December 31, 20X5?

2. a.

   $64,500

   b.

   $61,500

   c.

   $61,000

   d.

   $58,000