Reference no: EM13327392
Complete the following exercise. Submit journal entries in an Excel file and written segments in an MS Word document. Label each question clearly.
Johnny Bravo Company began operations in 2012 and has provided the following information.
1. Pretax financial income for 2012 is $100,000.
2. The tax rate enacted for 2012 and future years is 40%.
3. Differences between the 2012 income statement and tax return are listed below.
(a) Warranty expense accrued for financial reporting purposes amounts to $5,000. Warranty deductions per the tax return amount to $2,000.
(b) Gross profit on construction contracts using the percentage-of-completion method for book purposes amounts to $92,000. Gross profit on construction contracts for tax purposes amounts to $62,000.
(c) Depreciation of property, plant, and equipment for financial reporting purposes amounts to $60,000. Depreciation of these assets amounts to $80,000 for the tax return.
(d) A $3,500 fine paid for violation of pollution laws was deducted in computing pretax financial income.
(e) Interest revenue earned on an investment in tax-exempt municipal bonds amounts to $1,400.
4. Taxable income is expected for the next few years.
Use the spreadsheet Journal Entries to prepare the journal entry to record income tax expense, deferred taxes, and income taxes payable for 2012.
Draft the income tax expense section of the income statement, beginning with Income before income taxes
Attachment:- spreadsheets.xlsx
|
What is the magnitude of the velocity of the airplane
: A jet airplane flying from Darwin, Australia, has an air speed of 256 m/s in a direction 5.0° south of west. What is the magnitude of the velocity of the airplane relative to earth
|
|
Identify the potential sales and department store
: Identify the potential sales and department store transactions that can be stored within the database and design a database solution and the potential business rules that could be used to house the sales transactions of the department store.
|
|
Will the price paid by the consumer be reduced
: What happens when supply is totally elastic or totally inelastic, and a subsidy is given by the government: Will the producer change the amount of units he’s supplying to the market? And will the price received by the producer be reduced
|
|
What is the impedance at the resonant frequency
: A 190-?F capacitor and a 80m H inductor are in series with a 105 ? resistor. What is the impedance at the resonant frequency
|
|
Prepare the journal entry to record income tax
: Prepare the journal entry to record income tax expense, deferred taxes, and income taxes payable for 2012 - draft the income tax expense section of the income statement, beginning with Income before income taxes
|
|
The process of lobbying legislatures
: The process of lobbying legislatures is itself a big business. State legislatures are under the same kind of pressure from interest groups as the Senate and the House of Representatives.
|
|
What is the total external work done on the system
: Jonathan is riding a bicycle and encounters a hill of height h. What is the total external work done on the system of Jonathan and the bicycle between the time he starts up the hill and the time he reaches the top
|
|
Explain in detail how your choice of tool would help the
: Why should the govt monitor money supply? If we are in recession today, which one of the three tools of monetary policy would you suggest and why? And explain in detail how your choice of tool would help the economy?
|
|
Determine the charge on each plate
: An air-filled capacitor consists of two parallel plates, each with an area of 7.60 cm2, separated by a distance of 1.60 mm. Calculate the charge on each plate
|