The accounting records of Rhyme Timber Ltd provide income statement data for 2016: $940000 (750 000)...

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The accounting records of Rhyme Timber Ltd provide income statement data for 2016: $940000 (750 000) Total revenue Total expenses Profit before income tax $190000 Total expenses include depreciation of $50000 calculated under the straight-line method. In calculating taxable income on the tax return, Rhyme Timber uses the reducing-balance (RB) method. RB depreciation was $80000 for 2016. The company income tax rate is 30%. Requirements 1 Calculate taxable income for the year. 2 Prepare the journal entry in respect of income tax for 2016. 3 Show how to report income tax liabilities on Rhyme's balance sheet. The accounting records of Rhyme Timber Ltd provide income statement data for 2016: $940000 (750 000) Total revenue Total expenses Profit before income tax $190000 Total expenses include depreciation of $50000 calculated under the straight-line method. In calculating taxable income on the tax return, Rhyme Timber uses the reducing-balance (RB) method. RB depreciation was $80000 for 2016. The company income tax rate is 30%. Requirements 1 Calculate taxable income for the year. 2 Prepare the journal entry in respect of income tax for 2016. 3 Show how to report income tax liabilities on Rhyme's balance sheet.

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To calculate the taxable income for the year we need to adjust the depreciation expense to match the ... View the full answer