Problem 11-12 (Algo) [LO 11-3, 11-4] Luong Corporation, a calendar year, accrual basis corporation, reported $1.40 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: ● ● ● Luong's federal income tax expense per books was $208,000. Luong's book income included $18,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $8,000 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $18,000 of capital losses this year and no capital gains. Luong recorded $12,000 of book expense for meals not provided by a restaurant and $14,000 of book expense for entertainment costs. Luong's depreciation expense for book purposes totaled $408,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income.

Problem 11-12 (Algo) [LO 11-3, 11-4] Luong Corporation, a calendar year, accrual basis corporation, reported $1.40 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: ● ● ● Luong's federal income tax expense per books was $208,000. Luong's book income included $18,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $8,000 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. Luong recognized $18,000 of capital losses this year and no capital gains. Luong recorded $12,000 of book expense for meals not provided by a restaurant and $14,000 of book expense for entertainment costs. Luong's depreciation expense for book purposes totaled $408,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling Luong's book and taxable income.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 47P

See similar textbooks

Similar questions

Caloundra Corporation has book income of $ 40,000. Included in the book income is $3,000 of tax-exempt interest, $7,000 of book income tax expense, and a $2,000 nondeductible fine. Also included in book income are $10,000 of dividends. Caloundra received from a 30 percent owned corporation. Using this information and Form 1120 provide the amounts that go on each line on the form. Form 1120, Schedule M-1 Line 1 $__________________ Form 1120, Schedule M-1, Line 10 $__________________ Form 1120, Page 1, Line 28 $__________________ Form 1120, Schedule C, Line 2(a) $ and 2(c) $__________________ Form 1120, Schedule C, Line 24 $__________________ Form 1120, Page 1, Line 29b $__________________ Form 1120, Page 1 , Line 30 $__________________
Problem 13-18 (LO. 2) Penguin Corporation (a cash basis, calendar year taxpayer) recorded the following income and expenses in the current year. Income from services Salaries paid to employees Tax-exempt interest income Dividends from a corporation in which Penguin holds a 12% interest Short-term capital loss on the sale of stock Estimated Federal income taxes paid Gross income Penguin purchased 7-year MACRS property in the current year for $80,000 (current year percentage 14.29%); it did not claim any 5 179 additional first-year depreciation. The property has a 10-year ADR midpoint life. a. Determine taxable income and current E & P for Penguin Corporation. When required, round your answers to the nearest dollar. Less: operating expenses Taxable income before dividends received deduction Less: dividends received deduction Taxable income Show Transcribed Text Taxable income $400,000 70,000 24,000 Add: total additions to E & P 40,000 17,000 110,000 b. Determine Penguin's current E & P.…
1. Faye Faye Corporation's statement of financial performance for the year ended December 31, 20X2, shows pretax income of P 1,000,000. The following items are treated differently on the tax return and in the accounting records. Tax Return Accounting Records Rent income P 70,000 P 120,000 Depreciation Expense 280,000 220,000 Premiums on officers' life insurance 90,000 Faye Faye's rate for 20X2 is 30%. How much is the current tax expense for 20X2?
Required information Problem 12-53 (LO 12-3) The following information applies to the questions displayed below.] In its first year of existence (year 1), Willow Corp. (a C corporation) reports a loss for tax purposes of $50,000. In year 2 it reports a $40,000 loss. For year 3, it reports taxable income from operations of $100,000 before any loss carryovers. How much tax will Willow Corp. pay in year 3, what is its NOL carryover to year 4, and when will the NOL expire under the following assumptions? (New Corporate income tax rate has been mentioned as "21% on all taxable income" as per the recent change. Leave no answer blank. Enter zero if applicable.) Problem 12-53 Part b b. Year 1 is 2018. Willow Corp. tax liability in Year 3 Willow Corp. NOL carryover to Year 4
5 Suppose that in addition to $17.95 million of taxable income, Texas Taco, Inc., received $2,100,000 of interest on state-issued bonds and $710,000 of dividends on common stock it owns in Arizona Taco, Inc. (Use corporate tax rate of 21 percent for your calculations.) a. Calculate Texas Taco's income tax liability. (Enter your answer in dollars not in millions.) Income tax liability b. What are Texas Taco's average and marginal tax rates on taxable income? (Round your answers to 2 decimal places.) Average tax rate Marginal tax rate % %
4. What amount of total tax expense should be reported? To compute the provision for income tax, the following Pecorino Company had pretax financial income of P2,500,000 The entity made corporate estimated tax payment in the Problem 16-30 (IFRS) in the current year. amount of 180,000 during the current year. information was provided: Interest income received Tax depreciation in excess of financial statement amount 160,000 360,000 Rent received in advance Corporate tax rate. 280,000 30% 1. What amount of permanent difference between book income and taxable income existed at year-end? a. 520,000 b. 360,000 c. 800,000 d. 280,000 2. What amount of current tax expense should be reported? a. 786,000 b. 510,000 c. 750,000 d. 678,000 3. What amount of income tax payable should be reported a. 498,000 b. 606,000 c. 330,000 d. 570,000 a. 714,000 b. 726,000 c. 642,000 d. 594,000 570
Exercise 28-12 (Algorithmic) (LO. 1) The entity reports the following transactions for the 2022 tax year. The trustee accumulates all accounting income for the year. Operating income from a business $565,000 33,900 Dividend income, all from U.S. corporations (20% tax rate) Interest income, City of San Antonio bonds 4,520,000 Trustee fees, deductible portion (16,950) Net rental losses, passive activity (113,000) Click here to access tax table for this problem. Carryout the tax computations to two decimal places and round the final tax liability to the nearest dollar. Compute the Federal income tax liability for the Valerio Trust by providing the following amounts: The amount of the trustee's gross income taxed at 20% for the Valerio Trust is $ 33,900 V. The Trustee taxable income taxed at ordinary rates for the Valerio Trust is $ 547,950 V. The Federal income tax liability for the Valerio Trust is $ x.
Problem 11-12 (Algo) [LO 11-3, 11-4] Luong Corporation, a calendar year, accrual basis corporation, reported $1.35 million of net income after tax on its financial statements prepared in accordance with GAAP. The corporation's books and records reveal the following information: • Luong's federal income tax expense per books was $207,000. • Luong's book income included $17,000 of dividends received from a domestic corporation in which Luong owns a 25 percent stock interest, and $7,500 of dividends from a domestic corporation in which Luong owns a 5 percent stock interest. • Luong recognized $17,000 of capital losses this year and no capital gains. • Luong recorded $11,600 of book expense for meals not provided by a restaurant and $13,500 of book expense for entertainment costs. • Luong's depreciation expense for book purposes totaled $407,000. MACRS depreciation was $475,000. Required: a. Compute Luong's federal taxable income and regular tax liability. b. Prepare a Schedule M-1, page…
Pecorino Company had pretax financial income of P2,500,000 in the current year. The entity made corporate estimated tax payment in the amount of 180,000 during the current year. To compute the provision for income tax, the following information was provided: Interest income received 360,000 Tax depreciation in excess of financial statement amount 160,000 Rent received in advance 280,000 Corporate tax rate 30% 2. What amount of current tax expense should be reported? a. 786,000b. 510,000c. 750,000d. 678,000
Pecorino Company had pretax financial income of P2,500,000 in the current year. The entity made corporate estimated tax payment in the amount of 180,000 during the current year. To compute the provision for income tax, the following information was provided: Interest income received 360,000 Tax depreciation in excess of financial statement amount 160,000 Rent received in advance 280,000 Corporate tax rate 30% What amount of permanent difference between book income and taxable income existed at year-end?
Pecorino Company had pretax financial income of P2,500,000 in the current year. The entity made corporate estimated tax payment in the amount of 180,000 during the current year. To compute the provision for income tax, the following information was provided: Interest income received 360,000 Tax depreciation in excess of financial statement amount 160,000 Rent received in advance 280,000 Corporate tax rate 30% What amount of income tax payable should be reported?a. 498,000b. 606,000c. 330,000d. 570,000
The Loquat Corporation has book net income of $170,200 for the current year. Included in this figure are the following items, which are reported on the corporation's Schedule M-1, Reconciliation of Income (Loss) per Books with Income per Return. Federal income tax expense $25,530 • Depreciation deducted on the books which is not deductible for 34,040 tax purposes • Deduction for 50 percent of meals expense which is not allowed 15,318 for tax purposes Deduction for entertainment not allowed for tax purposes 6,808 • Tax-exempt interest income included in book income but not in 10,212 tax income Calculate Loquat Corporation's taxable income for the current year based on the information given.