Business, 18.03.2020 01:08 soupsah7304
Prepare the schedule of year-end deferred tax assets and liabilities for each year. The schedule should separately list the sources of the firm’s ending deferred tax assets and deferred tax liabilities by their source. The total for each schedule should equal the firm’s deferred tax asset and deferred tax liability balance at the end of the year.
Prepare a schedule reconciling the Statutory Tax Rate to the Effective Tax Rate in dollars and percentages.
Determine the amount of current and deferred tax expense for each year.
Assume that during year 2 Congress changes the tax rate from 20% to 25% starting in year 3 and all years thereafter. Recalculate tax expense for year 2 adjusting for the future tax rate increase.
On 1/1/Y1, the firm issued 10,000 nonqualified stock options to employees. The shares are currently trading for $10 per share. The option exercise price is set equal to $10 and the fair value of each option is $3. The vesting service period for the stock options is 18 months. The firm receives a deduction equal to the employee’s gain on the exercise of the option when the option is exercised. At the end of year 2 employees exercised 7,000 options. The fair value of the firm’s stock on this date is $19 per share.
On 1/1/Y1 the firm purchased 1,000 shares of D Corp. for $30 per share. The shares are classified as minority passive investments. Gains/Losses are taxable/deductible when the shares are sold.
On 1/1/Y1 the firm paid a $90,000 premium for a 3-year insurance policy that expires 12/31/Y3. The insurance premiums are deductible when paid.
During Y2, the firm accrued charges of $32,000 that will be deductible when paid in Y3.
Use a domestic (US) tax rate of 20% and a foreign tax rate of 12%. Assume all book/tax Differences relate to domestic taxable income.
Year 1
Year 2
Domestic Earnings before Tax
$600,000
$1,000,000
Foreign earnings before tax
$300,000
$200,000
D. Corp. year-end share price
$20
$24
12/31 balance in unearned revenue (taxable when received)
$400,000
$300,000
Nondeductible Excessive Compensation paid
$50,000
$60,000
Nontaxable Interest Income received
$24,000
$16,000
R&D Tax credit taken
$20,000
$30,000
GAAP Depreciation expense recorded
$100,000
$130,000
Tax deduction for depreciation
$180,000
$220,000
Answers: 2
Business, 22.06.2019 02:30, llama1314
Sweeten company had no jobs in progress at the beginning of march and no beginning inventories. the company has two manufacturing departments--molding and fabrication. it started, completed, and sold only two jobs during march—job p and job q. the following additional information is available for the company as a whole and for jobs p and q (all data and questions relate to the month of march): molding fabrication total estimated total machine-hours used 2,500 1,500 4,000 estimated total fixed manufacturing overhead $ 10,000 $ 15,000 $ 25,000 estimated variable manufacturing overhead per machine-hour $ 1.40 $ 2.20 job p job q direct materials $ 13,000 $ 8,000 direct labor cost $ 21,000 $ 7,500 actual machine-hours used: molding 1,700 800 fabrication 600 900 total 2,300 1,700 sweeten company had no underapplied or overapplied manufacturing overhead costs during the month. required: for questions 1-8, assume that sweeten company uses a plantwide predetermined overhead rate with machine-hours as the allocation base. for questions 9-15, assume that the company uses departmental predetermined overhead rates with machine-hours as the allocation base in both departments. 1. what was the company’s plantwide predetermined overhead rate? (round your answer to 2 decimal places.) next
Answers: 2
Business, 22.06.2019 10:20, christianconklin22
The following information is for alex corp: product x: revenue $12.00 variable cost $4.50 product y: revenue $44.50 variable cost $9.50 total fixed costs $75,000 what is the breakeven point assuming the sales mix consists of two units of product x and one unit of product y?
Answers: 3
Business, 22.06.2019 14:50, keishadawson
The following information is needed to reconcile the cash balance for gourmet catering services. * a deposit of $5,600 is in transit. * outstanding checks total $1,000. * the book balance is $6,400 at february 28, 2019. * the bookkeeper recorded a $1,800 check as $17,200 in payment of the current month's rent. * the bank balance at february 28, 2019 was $17,410. * a deposit of $400 was credited by the bank for $4,000. * a customer's check for $3,300 was returned for nonsufficient funds. * the bank service charge is $90. what was the adjusted book balance?
Answers: 1
Prepare the schedule of year-end deferred tax assets and liabilities for each year. The schedule sho...
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