On December 31, 2021 Celery Corporation provided the following information: Income before Income Taxes $1,440,000 Taxable...
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On December 31, 2021 Celery Corporation provided the following information: Income before Income Taxes $1,440,000 Taxable income $969,000 Deferred income tax expenses: Deferred income tax expense 8,000 • Deferred income tax (recovery) 10,400 • Tax rate 28% What amount will be reported as net income (after tax) on the income statement? 1,036,800 1,168,680 700,080 1,171,080 1,166,280 In 2019, Twix Company sold mattresses for $1,000,000 with a ten-year assurance warranty. The warranty estimate in 2019 was 2% of the sales amount. In 2020 and 2021, $5,000 in warranty payments were made (each year). Warranties are deductible for taxes only when paid. The following information is available for the company 2019 1,250 DIT expense 4,000 DIT recovery 250 DIT recovery Income before taxes Tax rates (enacted in each year) What is the recorded DIT expense or recovery amount and account for 20207 (hint: use a piece of paper and track) the warranty provision and DIT account) 3,750 DIT expense 250 DIT expense 2020 120,000 20% 2021 135,000 30% 125,000 25% On December 31, 2021 Celery Corporation provided the following information: Income before Income Taxes $1,440,000 Taxable income $969,000 Deferred income tax expenses: Deferred income tax expense 8,000 • Deferred income tax (recovery) 10,400 • Tax rate 28% What amount will be reported as net income (after tax) on the income statement? 1,036,800 1,168,680 700,080 1,171,080 1,166,280 In 2019, Twix Company sold mattresses for $1,000,000 with a ten-year assurance warranty. The warranty estimate in 2019 was 2% of the sales amount. In 2020 and 2021, $5,000 in warranty payments were made (each year). Warranties are deductible for taxes only when paid. The following information is available for the company 2019 1,250 DIT expense 4,000 DIT recovery 250 DIT recovery Income before taxes Tax rates (enacted in each year) What is the recorded DIT expense or recovery amount and account for 20207 (hint: use a piece of paper and track) the warranty provision and DIT account) 3,750 DIT expense 250 DIT expense 2020 120,000 20% 2021 135,000 30% 125,000 25%
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The detailed answer for the above question is provided below For the first image you have provided the following pieces of information Income before Income Taxes 1440000 Taxable Income 969000 Deferred ... View the full answer
Related Book For
Financial Accounting
ISBN: 978-1259103285
5th Canadian edition
Authors: Robert Libby, Patricia Libby, Daniel Short, George Kanaan, M
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