16. Red Company was organized on January 2, 2002, had pretax accounting income of P1,500,000 and taxable income of P2,400,000 for the year ended December 31, 2002. Red expected to maintain this level of taxable income in future years. The only temporary difference is for accrued product warranty costs expected to be paid as follows: 2003 P300,000 150,000 2005 P150,000 300,000 2004 2006 The applicable enacted income tax rate is 32%. In Red's December 31, 2002 balance sheet, the deferred income tax asset and related valuation allowance should be: Deferred tax asset Valuation alowance Deferred tax asset Valuation allowance (a) (b) PO PO (c) (d) P288,000 PO PO P288,000 P288,000 P288,000

16. Red Company was organized on January 2, 2002, had pretax accounting income of P1,500,000 and taxable income of P2,400,000 for the year ended December 31, 2002. Red expected to maintain this level of taxable income in future years. The only temporary difference is for accrued product warranty costs expected to be paid as follows: 2003 P300,000 150,000 2005 P150,000 300,000 2004 2006 The applicable enacted income tax rate is 32%. In Red's December 31, 2002 balance sheet, the deferred income tax asset and related valuation allowance should be: Deferred tax asset Valuation alowance Deferred tax asset Valuation allowance (a) (b) PO PO (c) (d) P288,000 PO PO P288,000 P288,000 P288,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

the income statement of x ltd for the year ended was as follows: net sales 4032000, cost of sales 3168000, depreciation 96000, salaries and wages 384000, opex 128000, provision for taxation 140800, net operating profit 11520. compute net profit before working capital changes
Statement of Profit and Loss and Other Comprehensive Income for the years ended 31 December 2024 2023 R'000 R'000 Turnover 1287052 934052 Operating Profit 137342 81768 Net Finance Cost 39264 20862 Operating Profit before taxation 98078 60906 Income tax expense 7027 3048 Profit for the Year 91051 57858 3502 2237 Operating profit includes Depreciation and loss on sale of fixed asset 5/12 Required: a) Prepare the cash flows from operating activities for the company for 2024 using the available information (10 Marks) b) Perform a financial review of the company based on calculating the following financial ratios and explain how it may be interpreted. Debt equity ratio Times interest earned Current ratio Debtors average collection period Inventory turnover Your answer should include an overall assessment of the company (25 Marks) c) List the audit steps to verify the existence of inventory (10 Marks)
Selected current year company information follows: Net income. Net sales Total liabilities, beginning-year Total liabilities, end-of-year Total stockholders' equity, beginning-year Total stockholders' equity, end-of-year The total asset turnover is: (Do not round Intermediate calculations.) $ 16,753 720,855 91,932 111, 201 206,935 133,851
You have just obtained financial information for the past 2 years for Sebring Corporation. SEBRING CORPORATION INCOME STATEMENTS FOR YEAR ENDING DECEMBER 31 (MILLIONS OF DOLLARS) 2002 2001Sales 3,600.00 3,000.00Operating costs (excluding dep. and amort.) (3,060.00) (2,550.00)EBITDA 540.00 450.00Depreciation and amortization (90.00) (75.00)Earnings before interest and taxes 450.00 375.00Interest (65.00) (60.00)Earnings before taxes…
Data for item nos. 24 & 25 Di Ka Na Mahal Company reported the following information during the first year of operations: P 9,000,000 1,000,000 1,500,000 2,000,000 30% Pretax financial income Nontaxable interest received Long-term loss accrual in excess of deductible amount Tax depreciation in excess of financial depreciation Income tax rate 24. What is the current tax expense? A. P2,250,000 C. P1,800,000 B. P2,700,000 D. P2,550,000 25. What is the deferred tax asset at the year-end? В. Р450,000 С. Р750,000 A. P600,000 D. P150,000
(46) Calculate Company Y's total asset turnover based on the following information for the current year: Net income $200,000 Assets at the beginning of the year $100,000 Assets at the end of the year $140,000 Net Sales $900,000
Kamulinda Company Limited (KCL) has provided the following financial information that relates to the year ended 31 December 2020: Statement of profit or loss Sales revenue Cost of sales Gross profit Administrative costs Distribution costs Operating profit Interest received Interest paid Profit before tax Taxation Profit after tax Shs '000' Assets: Non-current assets Accumulated depreciation Netbook value Investments Current assets: Inventory 250,400 (87,900) 162,500 (35,000) (50,000) 77,500 45,000 Shs '000' (25,000) 97,500 (20,000) 77,500 Statement of position as at 31 December: 2020 2019 Shs '000' Shs '000' 459,000 246,000 (125,000) (89,000) 334,000 157,000 76,000 156,000 100,000 Find current assets continued- Accounts receivable Cash at hand Cash at bank Total assets Equity and liabilities: Share capital Share premium Retained earnings Revaluation Non-current liabilities: Long term loan Current liabilities: Accounts payable Interest payable Tax Bank overdraft 24,450 65,000 655,450…
Refer to the following data of OCT2023CPACompany: Assets to be realized 1,375,000Assets acquired 825,000 Liabilities liquidated 1,875,000Assets realized 1,200,000Liabilities not liquidated 1,700,000 Assets not realized 1,375,000Llabilities assumed 1,625,000Llabilities to be liquidated 2,250,000 Supplementary charges 3,125,000 Supplementary credits 2,800,000 Compute the beginning cash balance assuming that the ending balance of ordinary share and retained earnings are P1,200,000 and (400,000), respectively
Randall Corporation reported the following revenue data:Year Net revenues (in millions)$$$$6,8007,0046,7327,2762016201720182019Use 2016 as the base year. The trend percentage in 2019 is closest toa. 93%.b. 104%.c. 107%.d. 112%
Account MNO Corporation had the following information regarding its fixed assets: Beginning of the year: $500,000Additions during the year: $100,000Disposals during the year: $50,000Accumulated depreciation at the beginning of the year: $200,000Depreciation expense for the year: $50,000Calculate the net book value of fixed assets at the end of the year.
The following information was reported by Amuse Yourself Parks (AYP): Net fixed assets (beginning of year) Net Fixed assets (end of year) Net sales for the year Net income for the year Required: Compute the company's fixed asset turnover ratio for the year. Numerator Denominator Fixed Asset Turnover Ratio 11 $ 8,490,000 8,290,000 4,111,100 1,930,000 "1
The following information appeared in the annual financial statements of Havard Projects Limited: Statement of Comprehensive Income for the year ended 31 December 2019 R Revenue 1 250 000 Direct costs (786 000) Gross profit 464 000 Operating expenses (124 000) Operating profit 340 000 Interest expense (15 000) Profit before tax 325 000 Income tax (97 500) Profit after tax 227 500 Statement of Financial Position as at 31 December 2019 Assets R Non-current assets 314 000 Current assets 386 000 Total assets 700 000 Equity and liabilities Shareholders’ equity 350 000 Non-current liabilities 205 000 Current liabilities 145 000 Total equity and liabilities 700 000 Note Current assets (R386 000) include accounts receivable of R160 000, inventories of R80 000 and cash of R146 000. Inventories as at 31 December 2018 amounted to R130 000. Current liabilities comprise…