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[The following information applies to the questions displayed below.] Timpanogos Inc. is an accrual-method calendar-year corporation. For 2014, it reported financial statement income after taxes
[The following information applies to the questions displayed below.]
Timpanogos Inc. is an accrual-method calendar-year corporation. For 2014, it reported financial statement income after taxes of $1,149,000. Timpanogos provided the following information relating to its 2015 activities: |
Life insurance proceeds as a result of CEOs death | $ | 200,000 |
Revenue from sales (for both book and tax purposes) | 2,000,000 | |
Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. | 21,000 | |
Charitable contributions | 180,000 | |
Interest income on private activity tax-exempt bonds issued in 2014. | 40,000 | |
Interest paid on loan obtained to purchase tax-exempt bonds | 45,000 | |
Rental income payments received and earned in 2015 | 15,000 | |
Rental income payments received in 2014 but earned in 2015 | 10,000 | |
Rental income payments received in 2015 but not earned by year-end | 30,000 | |
MACRS depreciation | 55,000 | |
Book Depreciation | 25,000 | |
Alternative minimum tax depreciation | 50,000 | |
Net capital loss | 42,000 | |
Federal income tax expense for books in 2015 | 500,000 | |
Timpanogos did not qualify for the domestic production activities deduction. (Leave no answer blank. Enter zero if applicable.) |
4.
value: 25.00 points
Required information
a. | Reconcile book income to taxable income for Timpanogos Inc. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income. |
d. | Compute Timpanogos, Inc.s regular tax liability. |
e. | Determine Timpanogoss alternative minimum tax, if any. |
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