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The accounting records of Marin Inc. show the following data for 2017 (its first year of operations). 1. Life insurance expense on officers was $8,100.
The accounting records of Marin Inc. show the following data for 2017 (its first year of operations). 1. Life insurance expense on officers was $8,100. 2. Equipment was acquired in early January for $315,000. Straight-line depreciation over a 5-year life is used, with no salvage value. For tax purposes, Marin used a 30% rate to calculate depreciation. 3. Interest revenue on State of New York bonds totaled $4,200. 4. Product warranties were estimated to be $53,100 in 2017. Actual repair and labor costs related to the warranties in 2017 were $9,800. The remainder is estimated to be paid evenly in 2018 and 2019. 5. Gross profit on an accrual basis was $ 103,000. For tax purposes, $77,000 was recorded on the installment-sales method. 6. Fines incurred for pollution violations were $4,800. 7. Pretax financial income was $811,900. The tax rate is 30%. Id) Prepare a schedule starting with pretax financial income in 2017 and ending with taxable income in 2017. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Schedule of Pretax Financial Income and Taxable Income for 2017 Pretax financial income Permanent differences Temporary differences Taxable income
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