Eastern Pacific Distributors began operations in January 2021 and purchased a delivery truck for $40,000. Eastern...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Eastern Pacific Distributors began operations in January 2021 and purchased a delivery truck for $40,000. Eastern Pacific plans to use straight-line depreciation over a four-year expected useful life for financial reporting purposes. For tax purposes, the deduction is 50% of cost in 2021, 30% in 2022, and 20% in 2023. Pretax accounting income for 2021 was $200,000, which includes interest revenue of $28,000 from municipal governmental bonds. The enacted tax rate is 25%. Assuming no differences between accounting income and taxable income other than those described above. What is the amount of 2021 net income? a. $158,500 b. $159,500 c. $157,500 d. $157,000 Eastern Pacific Distributors began operations in January 2021 and purchased a delivery truck for $40,000. Eastern Pacific plans to use straight-line depreciation over a four-year expected useful life for financial reporting purposes. For tax purposes, the deduction is 50% of cost in 2021, 30% in 2022, and 20% in 2023. Pretax accounting income for 2021 was $200,000, which includes interest revenue of $28,000 from municipal governmental bonds. The enacted tax rate is 25%. Assuming no differences between accounting income and taxable income other than those described above. What is the amount of 2021 net income? a. $158,500 b. $159,500 c. $157,500 d. $157,000
Expert Answer:
Answer rating: 100% (QA)
A 1 Earnings Before Tax 2 Interest Revenue B 200000 28000 10000 20000 10000 3 Deprec... View the full answer
Related Book For
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
Posted Date:
Students also viewed these accounting questions
-
A new retail store has offered to buy 14,800 of its skateboards for $53 per unit. The store is in a different market from Calla's regular customers and would not affect regular sales. A study of its...
-
Selling price = $15 per unit Variable costs - variable manufacturing costs = $5 per unit variable selling costs = $2 per unit Fixed costs - Fixed manufacturing costs = 4 per unit Fixed selling costs...
-
We wish to model a consumer's choice between a product (call it good X) at different prices, and the composite good, priced at $1 per unit. Suppose a consumer has a disposable income in each period...
-
The lease agreement and related facts indicate the following: a. Leased equipment had a retail cash selling price of $300,000. Its useful life was five years with no residual value. b. The lease term...
-
Enter the following information and transactions in the check register for Happy Center Day Care (Figure 4 - 45). On July 10, 20XX, with an account balance of $983.47, the account debit card was used...
-
Look closely at the Memorandum Joint Venture account. Where does each entry in the Memorandum Joint Venture account appear in the Joint Venture with Green and Joint Venture with White T-accounts? Are...
-
The sky hook is used to support the cable of a scaffold over the side of a building. If it consists of a smooth rod that contacts the parapet of a wall at points A, B, and C, determine the normal...
-
Chris Martin has prepared the following list of statements about managerial accounting and financial accounting. 1. Financial accounting focuses on providing information to internal users. 2....
-
HISTORY OF PSYCHOLOGY Note : Your answer to each question should be 200 words each questions , minimum. Chapter 4 is about the scientific beginnings of psychology. So, this...
-
Koho Ltd. produces handheld portable televisions. The normal selling price is $400 and its unit production cost is $264 as detailed below: Direct Materials Direct labour Manufacturing overhead $143 $...
-
Tracy needs some additional assistance. She has compared her budget to what actually happened this year. She sees there are differences but she is unsure why there are differences. She has included...
-
Problem 3: Given the following cash flows for project Z: CO= -2,000, C1 = 1,200; C2 = 1,440 and C3 = 3,000 Calculate the discounted payback period for the project at a discount rate of 20%. Give a...
-
Analyze the Trivago s search engine marketing strategy ( search engine optimization and paid search marketing ).
-
Phillips has funded a retirement investment with $250,000 earning a return of 6.75 percent annually. What is that he can receive in perpetuity? (Round to the nearest dollar.)
-
WSB Inc. will receive payments of $2 thousand every six months for the next three years. It will receive the first of these in six months. It will then get semiannual payments of $3 thousand for the...
-
What happens as the number of stocks in a portfolio increases in the modern portfolio theory? Group of answer choices Systematic risks decrease, and returns increase Firm-specific risks are reduced,...
-
I don't know how this works can you help 5-5A (Graded) i ! Required information TILL0378239A78252F0252Fms.mheducation.com%252Fmghmiddleware Saved [The following information applies to the questions...
-
Perform the operation by first converting the numerator and denominator to scientific notation. Write the answer in scientific notation. 7,200,00/0.000009
-
Define (a) nominal damages, (b) incidental damages, (c) consequential damages, (d) foreseeability of damages, (e) punitive damages, (f) liquidated damages, and (g) mitigation of damages.
-
On January 1, Mrs. Irene Kern leased an apartment from Colonial Court Apartments, Inc., for a one-year term. When the lease was entered into, Mrs. Kern asked for a quiet apartment, and Colonial...
-
This is a stocklist case arising under 220(b) of our [Delaware] General Corporation Law. The issue is whether a shareholder states a proper purpose for inspection under our statute in seeking to...
-
Assume that Timmons Towel and Diaper Services bank pays 1% (APR with quarterly compounding) on its compensating balance accounts. What is the EAR of Timmonss three-month loan?
-
What is the difference between transshipment and transloading?
-
Distinguish the roles played by liner shipping companies and terminal operators in LSCM.
Study smarter with the SolutionInn App