Reference no: EM131888406
Question: In 2017, Franklin Company reported pretax GAAP income of $500,000. The tax rate was 40%. The following items may be relevant to Franklin's calculation of tax expense in 2017.
In 2017, Franklin sold land under an installment sales contract and included total gross profit of $200,000 in GAAP income. Only $120,000 of the gross profit is taxable in 2017. The remainder of the gross profit is taxable in 2018.
In 2017, Franklin recorded depreciation for financial accounting of $800,000. The allowable tax depreciation for 2017 was $850,000.
In 2017, Franklin recorded an expense for a $20,000 fine paid for violating pollution laws.
In 2017, Franklin recorded warranty expense of $50,000. Only actual warranty costs paid in 2017 of $10,000 are deductible for tax purposes.
In 2017, Franklin included $70,000 for unrealized holding gains on trading securities in GAAP income. This amount is not included in taxable income until the security is sold.
Requirement 1: Compute 2017 taxable income.
Requirement 2: Compute 2017 tax payable.
Requirement 3: Determine the change(s) in the deferred tax account(s).
Requirement 4: Record the 2017 tax expense entry.
Requirement 5: Determine 2017 net income.
Considering new three year expansion project
: Summer Tyme, Inc., is considering a new 3-year expansion project that requires an initial fixed asset investment of $3.3 million.
|
What is cruz income from operations and net income
: In 2017, Matt Cruz Company had net sales of $900,000 and cost of goods sold of $522,000. Operating expenses were $225,000, and expense was $11,000.
|
Discuss the percentage-of-completion method
: Instructions: Complete a chart analyzing the above information showing revenue, the % of completion every year and the amount of gross profit to be recognized.
|
Calculate the net payouts for covered call strategy
: Calculate the net payouts for a covered call strategy for each different scenario.
|
Determine the change in the deferred tax account
: In 2017, Franklin Company reported pretax GAAP income of $500,000. The tax rate was 40%. The following items may be relevant to Franklin's calculation of tax.
|
Equity financing at company operating capital cost
: Melangkah Lagi is a company that uses 100% equity financing at a company's operating capital cost of 20%.
|
What is the total asset turnover rate
: Bonita Pizza Inc. has sales of $200,800, net profit of $36,600, What is the total asset turnover rate?
|
Prepare splish journal entry to correct the error
: In 2017, Splish Corporation discovered that equipment purchased on January 1, 2015, for $64,000 was expensed at that time.
|
What is jong deduction for interest expense
: In 2017, Jong paid $3,000 of interest on a qualified education loan. Jong files married joint and reports modified AGI of $150,000.
|