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Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2023, it reported financial statement income after taxes of $1,436,850. Timpanogos provided the following information relating to
Timpanogos Incorporated is an accrual-method, calendar-year corporation. For 2023, it reported financial statement income after taxes of $1,436,850. Timpanogos provided the following information relating to its activities for the year:
Life insurance proceeds as a result of CEO's death | $ 214,000 |
Revenue from sales (for both book and tax purposes) | 2,140,000 |
Premiums paid on the key-person life insurance policies. The policies have no cash surrender value. | 22,400 |
Charitable contributions | 192,600 |
Cost of goods sold for book and tax purposes | 321,000 |
Interest income on tax-exempt bonds | 42,800 |
Interest paid on loan obtained to purchase tax-exempt bonds | 48,150 |
Rental income payments received and earned in 2023 | 16,400 |
Rental income payments received in 2022 but earned in 2023 | 10,700 |
Rental income payments received in 2023 but not earned by year-end | 32,100 |
Tax depreciation | 58,500 |
Book Depreciation | 26,400 |
Net capital loss | 44,800 |
Federal income tax expense for books | 331,700 |
Required:
- Reconcile book income to taxable income for Timpanogos Incorporated. Be sure to start with book income and identify all of the adjustments necessary to arrive at taxable income.
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