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urgent pls answer b The following information relates to Blossom Corporation's transactions during 2023, its first year of operations. 1. Income before income tax on
urgent pls answer b
The following information relates to Blossom Corporation's transactions during 2023, its first year of operations. 1. Income before income tax on the income statement for 2023 was $51,000. 2. Income before income tax ( $51,000 above) is net of a loss due to the writedown of land of $50,000. 3. Blossom reported a tax-deductible financing charge of $5,900 on its 2023 statement of retained earnings. The charge is for interest on a financial instrument that is legally debthut in substance is equity for financial reporting purposes, 4. The tax rate enacted for 2023 and future years is 30%. Because this was Blossom's first taxation year. no instalments on account of income taxes were required or pald by Blossom. 5. Differences between the 2023 GAAP amounts and their treatinent for tax purposes were as follows: a. Warranty expense acerued for financial reporting purposes amounted to $14,000. Wacranty payments deducted for taxes amounted to $11,200. Warranty liabilities were classified as current on the SFP b. Of the loss on writedown of land of $50,000,25% will never be tax-deductible. The remaining 75% will be deductible for: tax purposes evenly over the years from 2024 to 2026. The loss relates to the loss in value of company land due to contamination c. Gross profit on construction contracts using the percentage-of-completionmethod for book purposes amounted to $29,000. For tax purposes gross profit on construction contracts amounted to sobecase the completed-contract method is used and no contracts were compieted during the vear. Construction costs amounted to $283,000 during the year. 5. Differences between the 2023GAAP amounts and their treatment for tax purposes were as follows: a. Warranty expense acerued for financial reporting purposes amounted to $14,000 Warranty payments deducted for taxes amounted to $11,200. Warranty liabilities were classified as current on the SFP. b. Of the loss on writedown of land of $50,000,25% will never be tax-deductible The remaining 75% will be deductible for tax purposes evenly over the years from 2024 to 2026 . The loss relates to the loss in value of company land due to contamination. c. Grossprofit on construction contracts using the percentage-of-completion method for book purposes amounted to \$29,000. For tax purposes, gross profit on construction contracts amounted to so because the completed-cantract method is used and no contracts were completed during the year Construction cons amounted to $283,000 during the year d. Depreciation of property, plant, and equipment for financial reportiog parposes armounted to 552,800 ccAcharged on the tax retum amounted to $70,400. The related propertyiplant. andeduicenent cost $264,000 when it was accuired early in 2023. e. A 53,400 fine paid for a violation of pollution laws was deducted in calculating acecunting income f. Dividend revenue earned on an imvestment was tax exempt ind smounted to 51,400 . 6. Taxable income is expected foe the next few years. Calculate Biossom's deferred tax asset or liability at December 31, 2023. Deferred tax Attempts: 9 of 15 used (7) Your answer is incorrect. Calculate the taxable income for 2023. Taxable income $ List of Accounts Attempts: 12 of 15 used Step by Step Solution
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