Journal entry to record income tax expense

Assignment Help Financial Management

Reference no: EM13929762

The Matrix Company began operations as of the beginning of 2015. During 2015, Matrix reported GAAP (book) income before taxes of $789,500. For income tax purposes, depreciation expense was $150,000; for GAAP (book) purposes, depreciation expense was $74,000. Matrix accrued $900,000 of revenue for GAAP (book) purposes during 2015; $600,000 of the accrued revenue was taxable during 2015. Matrix earned interest of $79,800 from a municipal bond investment during 2015. Matrix’s marginal income tax rate is 40%. Matrix did not make any income tax payments during 2015. a. Determine Matrix’s taxable income for the year ended December 31, 2015. b. Prepare the 2015 year-end journal entry to record income tax expense.

Reference no: EM13929762

Questions Cloud

What is the net cash flow from the salvage value : Ronnie's Custom Cars purchased some fixed assets two years ago for $90,000. The assets are classified as 5-year property for MACRS. Ronnie is considering selling these assets now so he can buy some newer fixed assets which utilize the latest in techn..

How democratic was colonial american society : Compare the causes of the uprisings led by Pope in New Mexico and Metacom in New England. Which was more successful? Why? How democratic was colonial American society? Some consider the Salem Witch Trials to be a persecution of women who lived 'outs..

Project is expected to create operating cash flows : A project is expected to create operating cash flows of $33,000 a year for three years. The initial cost of the fixed assets is $68,000. These assets will be worthless at the end of the project. An additional $4,500 of net working capital will be req..

How has mass communication changed society : How has mass communication changed society? Is mass communication new or just adapting? What effect does the computer have on mass communication?

Journal entry to record income tax expense : The Matrix Company began operations as of the beginning of 2015. During 2015, Matrix reported GAAP (book) income before taxes of $789,500. For income tax purposes, depreciation expense was $150,000; for GAAP (book) purposes, depreciation expense was ..

Interest rate you are paying on funds you actually receive : Your business does about $1.5 million in business, with sales equally spread throughout the year. Assuming you factor all of your receivables in the coming year, how much in total dollars will your financing arrangement with Slick Willy cost? How muc..

What are the supply chain management issues in wilmar : What are the supply chain management issues in Wilmar International Singapore? What are the critical success factors in the supply chain management of Wilmar International Singapore?

What should be elements of a zero-tolerance ethics policy : What should be the elements of a zero-tolerance ethics policy? Are any of these elements missing at Siemens Global? What leadership and followership ethics lessons do you take from this case?

Mean cost of capital over the next decade is anticipated : John J. Smith & Co. is developing a new product. In order to finance this venture, management has requested you to make recommendations. The current market value (market cap) of Smith & Co. is $14M. The mean cost of capital over the next decade is an..

User Account

All Pages