Help with intermediate accounting homework on taxable income?

Posted on 2014-04-11 12:11:00 in Accounting by A

pretax book income 950000



1. company lost a suit for 175,000 and recorded on its books

2. included in book income is a fine for 125000

3. earned municipal bond income 25000 that is included in book income

4. purchased asset for 300,000. regular depreciation = 5 years but for tax purposes = 3 yrs

5. received 15000 in prepayments for tickets (unearned rev). Expect to realize this for book purposes for 2013-2016 (5000 per year)

6. tax rate is 40% in 2013 and 2014, 35% in 2014



1. what is 2013 taxable income? Prepare journal entry

2. in 2014 they also have 950,000 of income but suffer no losses and have no bond income. Prepare entyr for 2014

hint: prepare schedule to indicate when tax/book differences on temporary items will reverse and use for 2013-2014

---

Answer Comment

No Answers Posted Yet.