Moderna Corporation is an accrual basis, a calendar-year C corporation. For each item below, determine the 2020
Question:
Moderna Corporation is an accrual basis, a calendar-year C corporation. For each item below, determine the 2020 Schedule M-1 adjustment to reconcile book income to taxable income, i.e., the amount and the effect ( + or -).
Net income per books | $850,000 |
Provision for Federal income taxes, $150,000 | |
Municipal bond interest, $15,000 | |
In 2020, Moderna increased its allowance for uncollectible accounts by $25,000; actual bad debts are written off in 2020 were $28,000. | |
Moderna reported depreciation for financial purposes of $105,000; MACRS, Bonus, & §179 amounts for the year were $150,000 | |
Moderna acquired another corporation in 2015, paying $450,000 for goodwill. Moderna recorded a goodwill impairment loss of $100,000 for financial purposes in 2020. | |
In December 2019, Moderna received $40,000 as an advance payment for rental of property. Moderna reported the $40,000 as a liability (unearned income) on its balance sheet at 12/31/19 and as earned income in 2020. | |
In December 2020, Moderna received $25,000 as an advance payment for the rental of the property. Moderna reported the $25,000 as a liability (unearned income) on its balance sheet on 12/31/20. | |
Moderna reported gains of $28,000 and losses of $35,000 from the sale of investments in its “Other Revenues & Expenses” section of its income statement. | |
Moderna received dividend income from 10%-owned corporations totaling $40,000. | |
Moderna deducted a $12,000 excess charitable contribution carryover from 2019 on its 2020 tax return. | |
In May 2020, Moderna paid a $25,000 fine to a local government for violating a local ordinance. | |
Taxable Income |
Financial Accounting
ISBN: 978-0078025549
3rd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann