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Required information The following information applies to the questions displayed below.) Arndt, Inc. reported the following for 2021 and 2022 ($ in millions) Revenues Expenses
Required information The following information applies to the questions displayed below.) Arndt, Inc. reported the following for 2021 and 2022 ($ in millions) Revenues Expenses Pretax accounting Income (income statement) Taxable incone (tax return) Tax rate: 25% 2021 $ 938 794 5 144 $ 106 2022 $1,030 850 $180 1214 a. Expenses each year include $56 million from a two-year casualty insurance policy purchased in 2021 for $112 million The cost is tax deductible in 2021 b. Expenses include $2 million insurance premiums each year for life insurance on key executives. c Arndt sells one-year subscriptions to a weekly Journal. Subscription sales collected and taxable in 2021 and 2022 were $57 million and $73 million, respectively Subscriptions included in 2021 and 2022 financial reporting revenues were $51 million ($36 million collected in 2020 but not recognized as revenue until 2021) and $57 million, respectively. Hint View this as two temporary differences-one reversing in 2021, one originating in 2021 . 2021 expenses included a $40 million unrealized loss from reducing investments (classified as trading securities) to fair value. The investments were sold and the loss realized in 2022 e. During 2020, accounting income included an estimated loss of $30 million from having accrued a loss contingency The loss was paid in 2021 at which time it is tax deductible t At January 1, 2021 Arndt had a deferred tax asset of 54 million and no deferred tax liability Required: 1. Which of the five differences described in items a-e are temporary and which are permanent differences? Casualty Insurance exponse h Life insurance premium Subscriptions drva zod loss on trading securities Los contingency Required information Complete this question by entering your answers in the tabs below. 13 Required 1 Required 2 ok Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millons rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5,5).) Future Current Future Taxable (5 in millions) Year 2021 Amounts [2022] Deductible Amounts 20221 Pretax accounting income Permanent difference Life insurance premiums Temporary differences Casualty insurance expense Subscriptions-2020 Subscriptions-2021 Unrealized loss Loss contingency Taxable income nces Enacted tax rate (%) Tax payable currently Deferred tax liability Deferred tax asset Required 2 > nare a contrar ranne merencanaan narayant nnmann avance in Required information Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the necessary journal entry to record income taxes for 2021. (IF no entry is required for a transaction entry required in the first account field. Enter your answers in millions rounded to 1 decimal place (1.e., 5,500 5.5)) View transaction list Journal entry worksheet 1 Record 2021 Income taxes. Noter Enter debits before credits General Journal Transaction 1 Debit Credit Record entry Clear entry View general journal
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