What book-tax differences in year 1 and year 2 associated with its capital gains and losses would
Question:
What book-tax differences in year 1 and year 2 associated with its capital gains and losses would ABD Inc. report in the following alternative scenarios? Identify each book-tax difference as favorable or unfavorable and as permanent or temporary.
a.
Year 1 Year 2
Capital gains………………..$20,000………$5,000
Capital losses………………….8,000…………….0
b.
Year 1 Year 2
Capital gains…….....$ 8,000……..................$5,000
Capital losses…….....20,000……............................0
c.
Year 1 Year 2
Capital gains………..$ 0………..$50,000
Capital losses……….25,000…………30,000
d.
Year 1 Year 2
Capital gains…………$ 0……..$40,000
Capital losses…………25,000…………….0
e.
Year 1 Years 2-5 Year 6
Capital gains….$ 0……….$ 0…...$15,000
Capital losses….10,000….........0….........…............0
f.
Year 1 Years 2 - 6 Year 7
Capital gains…………$ 0…………$0………….....$15,000
Capital losses…………10,000……0………………...0
Step by Step Answer:
a No booktax differences in either year b In year 1 there is a 12000 temporary unfavorable adjustmen...View the full answer
Taxation Of Individuals And Business Entities 2015
ISBN: 9780077862367
6th Edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver
