Squirrel, Inc., an accrual basis, calendar year C corporation reports the following results for 2022. Income...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Squirrel, Inc., an accrual basis, calendar year C corporation reports the following results for 2022. Income Gross profits on sales Dividend income Interest on US Treasury bonds Interest on Texas Education bonds Life insurance policy payout Gain on sale of investment land Expenses Bad debt expense Depreciation (book) Charitable contributions Loss on sale of stock Penalty for pollution Federal income tax expense Net income reported on fin statements Other information: $1,260,000 40,000 (10% owned domestic corp) 20,000 24,000 100,000 (key employee died) 16,000 10,000 331,619 16,000 2,400 900 230,807 $868,274 a. Regular tax depreciation (MACRS). Assume Squirrel uses Straight-Line for the ADS calculation. Acq Description 1/2022 Used Office Machinery GDS / ADS 2022 Depreciation 1,000,000 IRC Section 179 Depr. Basis Cost $1,072,000 - 1,000,000 Recovery 5 yr/ 6 yr 72,000 14,400 6/2021 Used Furniture 200,000 7 yr/ 10 yr 48,980 2/2022 Used Heavy Trucks 336,093 5 yr/ 6 yr 64,530 2/2018 Light Trucks 50,000 5 yr/ 5 yr TOTAL 9,600 1,137,510 b. Squirrel has an NOL carryforward from prior years of $80,000. c. Squirrel has a contribution carryforward from prior years of $1,000. d. 2022 writeoffs for bad debts equaled the accrual of bad debt expense. e. During 2022, Squirrel made quarterly estimated payments of $25,000 per quarter toward the 2022 corporate federal income tax liability. f. Squirrel's taxable income is calculated using the reconciliation approach as follows: Book income + Nondeductible Federal Income Tax Expense + Nondeductible Penalty - Nontaxable Municipal interest income -Life insurance proceeds - Tax depreciation in excess of book Sub + Charitable Limit ($18,609) Charitable Carryfoward -DRD -NOL Sub Taxable Income 868,274 230,807 900 (24,000) (100,000) (805,891) 170,090 (1,000) 163,090 (20,000) (80,000) 69,090 REQUIRED: Determine earnings & profits for Squirrel for the year 2022. Squirrel, Inc., an accrual basis, calendar year C corporation reports the following results for 2022. Income Gross profits on sales Dividend income Interest on US Treasury bonds Interest on Texas Education bonds Life insurance policy payout Gain on sale of investment land Expenses Bad debt expense Depreciation (book) Charitable contributions Loss on sale of stock Penalty for pollution Federal income tax expense Net income reported on fin statements Other information: $1,260,000 40,000 (10% owned domestic corp) 20,000 24,000 100,000 (key employee died) 16,000 10,000 331,619 16,000 2,400 900 230,807 $868,274 a. Regular tax depreciation (MACRS). Assume Squirrel uses Straight-Line for the ADS calculation. Acq Description 1/2022 Used Office Machinery GDS / ADS 2022 Depreciation 1,000,000 IRC Section 179 Depr. Basis Cost $1,072,000 - 1,000,000 Recovery 5 yr/ 6 yr 72,000 14,400 6/2021 Used Furniture 200,000 7 yr/ 10 yr 48,980 2/2022 Used Heavy Trucks 336,093 5 yr/ 6 yr 64,530 2/2018 Light Trucks 50,000 5 yr/ 5 yr TOTAL 9,600 1,137,510 b. Squirrel has an NOL carryforward from prior years of $80,000. c. Squirrel has a contribution carryforward from prior years of $1,000. d. 2022 writeoffs for bad debts equaled the accrual of bad debt expense. e. During 2022, Squirrel made quarterly estimated payments of $25,000 per quarter toward the 2022 corporate federal income tax liability. f. Squirrel's taxable income is calculated using the reconciliation approach as follows: Book income + Nondeductible Federal Income Tax Expense + Nondeductible Penalty - Nontaxable Municipal interest income -Life insurance proceeds - Tax depreciation in excess of book Sub + Charitable Limit ($18,609) Charitable Carryfoward -DRD -NOL Sub Taxable Income 868,274 230,807 900 (24,000) (100,000) (805,891) 170,090 (1,000) 163,090 (20,000) (80,000) 69,090 REQUIRED: Determine earnings & profits for Squirrel for the year 2022.
Expert Answer:
Related Book For
South-Western Federal Taxation 2019 Comprehensive
ISBN: 9781337703017
42th Edition
Authors: David M. Maloney, William A. Raabe, William H. Hoffman, James C. Young
Posted Date:
Students also viewed these accounting questions
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-5. Ivan's grandfather died and left a portfolio of municipal bonds. In 2012, they pay Ivan...
-
This assignment requires you to complete the 2022 tax reporting for a fictional woman named Anna Smith. Question 1 T1 - step 4 - line 66 This is Anna's taxable income Answer: Question 2 T1 - step...
-
Give a recursive algorithm for finding the reversal of a bit string. (See the definition of the reversal of a bit string in the preamble of Exercise 34 in Section 5.3.)
-
Zetatron is an all-equity firm with 100 million shares outstanding, which are currently trading for $7.50 per share. A month ago, Zetatron announced it will change its capital structure by borrowing...
-
Kenworth Company uses a job-order costing system. Only three jobs-Job 105, Job 106, and Job 107- were worked on during November and December. Job 105 was completed on December 10; the other two jobs...
-
The life \(T\) in hours of a vibration transducer is found to follow exponential distribution \[p_{T}(t)= \begin{cases}\lambda e^{-\lambda t}, & t \geq 0 \\ 0, & t <0\end{cases}\] where \(\lambda\)...
-
Midwest Mills has a plant that can mill wheat grain into a cracked wheat cereal and then further mill the cracked wheat into fl our. The company can sell all the cracked wheat cereal that it can...
-
The standard 2-pass spur gear train with the # of teeth on each gear as shown is driven is driven at 1000 RPM from shaft 2 with a torque of 25 in-lb. All the gears in the set have a diametral pitch...
-
The following items were derived from Woodbine Circle Corporations adjusted trial balance on December 31, 2016: Other financial data for the year ended December 31, 2016: Federal Income Taxes Paid...
-
Write a paper on the topic Leadership and Communication Skills Development This paper must include the followings parts Using Joharis Window to Strengthen the Relationship Transactional Analysis The...
-
2. Determine cross-sectional area. 3. Determine stress corresponding to each force. 4. Determine longitudinal strain using gage length, Lo=220 mm (not length (405,368,392 or 383) corresponding to...
-
2) may have Freudeinstein equation with respect to time and get kiu siu thi sinh (04-0) sin (04-02) Two of our can be A a A 4-bar mechanism is Position 1 a Position 2 velocity at one of the given...
-
c) When austenite containing about 0.8 wt% C is cooled below the A1 temperature, pearlite is formed. Explain carefully the microstructural characteristics and how pearlite is formed. (2p) d) With...
-
Derive equations of motion of the planar system composed of uniform beam and a disc, two linear springs and a torsional spring. For a given data compute natural frequencies and mode shapes of small...
-
Figure below shows a 2D cantilevered beam, length (L) 0.1 m, attached to an axial spring with spring stiffness (k) of 500,000 N/m. The square cross section of the cantilever beam measures 0.01 m x...
-
Two Lay's chip flavorsCheesy Garlic Bread and Kettle Cooked Wasabi Gingerwere created by consumers as part of Frito-Lay's wildly successful. "Do Us A Flavor" marketing campaign (www.dousaflavor.com)....
-
Horse serum containing specific antibody to snake venom has been a successful approach to treating snakebite in humans. How do you think this anti-venom could be generated? What are some advantages...
-
Stanford owns and operates two dry cleaning businesses. He travels to Boston to discuss acquiring a restaurant. Later in the month, he travels to Newr York to discuss acquiring a bakery. Stanford...
-
Steven established a sole proprietorship in 2012. He sold 1231 assets at a loss in 2016 and 2017. He had only sold 1231 assets at a gain before 2016. In 2018, he could sell a 1231 asset at a gain...
-
In 2018, Alva received dividends on her stocks as follows: Amur Corporation (a French corporation whose stock is traded on an established U.S. securities market)...
-
A closed vessel having a volume of \(2.84 \mathrm{~m}^{3}\) contains \(1.365 \mathrm{~kg}\) of mixture of water and steam at a pressure of 7 bar. Find how much heat must be added to the vessel to...
-
In steam tables, the entropy is shown as zero for (a) saturated vapour at atmospheric pressure (b) saturated liquid at atmospheric pressure (c) saturated vapour at \(0^{\circ} \mathrm{C}\) (d)...
-
Water equivalent of calorimeter is given by (a) \(\frac{m_{c a l} \times c_{p c}}{c_{p w}}\) (b) \(\frac{m_{c a l}}{c_{p w}}\) (c) \(\frac{m_{c a l}}{c_{p c}}\) (d) \(\frac{m_{c a l} \times c_{p...
Study smarter with the SolutionInn App