Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following differences enter into the reconciliation of financial income and taxable income of Crane Company for the year ended December 31, 2020. its first

image text in transcribed

image text in transcribed

The following differences enter into the reconciliation of financial income and taxable income of Crane Company for the year ended December 31, 2020. its first year of operations. The enacted income tax rate is 20% for all years. Pretax accounting income $830,000 Excess tax depreciation (412,000) Litigation accrual 83.000 Unearned rent revenue deferred on the books but appropriately recognized in taxable income 73.000 Interest income from New York municipal bonds (33.000 Taxable income $541,000 Excess tax depreciation will reverse equally over a four-year period, 2021-2024. It is estimated that the litigation liability will be paid in 2024. Rent revenue will be recognized during the last year of the lease, 2024. Interest revenue from the New York bonds is expected to be $33,000 each year until their maturity at the end of 2024 Prepare a schedule of future taxable and (deductible) amounts. (Enter negative amounts using either a negative sign preceding the number eg. 45 or parentheses eg. (45).) 2021 2022 2023 Future taxable (deductible) amounts: Depreciation $ "Litigation Unearned rent

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: Kermit D. Larson, William W. Pyle

4th Edition

0256067813, 978-0256067811

More Books

Students also viewed these Accounting questions