Depreciation report on the income statement

Assignment Help Accounting Basics
Reference no: EM13153808

The following information is available for Swanson Corporation for 2006.

1. Depreciation reported on the tax return exceeded depreciation reported on the income statement by $100,000. This difference will reverse in equal amounts of $25,000 over the years 2007-2010.

2. Interest received on municipal bonds was $10,000.

3. Rent collected in advance on January 1, 2006, totaled $60,000 for a 3-year period. Of this amount, $40,000 was reported as unearned at December 31, for book purposes.

4. The tax rates are 40% for 2006 and 35% for 2007 and subsequent years.

5. Income taxes of $360,000 are due per the tax return for 2006.

6. No deferred taxes existed at the beginning of 2006.


(a) Compute taxable income for 2006.

(b) Compute pretax financial income for 2006.

(c) Prepare the journal entries to record income tax expense, deferred income taxes, and income taxes payable for 2006 and 2007. Assume taxable income was $980,000 in 2007.

(d) Prepare the income tax expense section of the income statement for 2006, beginning with "Income before income taxes."

Reference no: EM13153808

Current asset section of janson balance sheet

Investments consist of treasury bills that were purchased in November and mature in January. Prepaid insurance is for the next two years. What amount should be included in t

Share of the partnership losses

The partnership reports losses of $500,000 in 2009 and $450,000 in 2010. Pearl's share of the partnership's losses is $50,000 in 2009 and $45,000 in 2010. How much of the lo

Total cash collection from receivables

The company's past records show collection of credit sales as follows: 30% in the month of sale and the balance in the following month. The total cash collection from receiv

Consolidated balance sheet after acquisition

Based on the preceding information, what amount of total liabilities was reported in the consolidated balance sheet immediately after acquisition?

Forensic and investigative accounting

The legal statutes and insurance policy coverage identify a number of loss categories from a cyber attack. In the list of losses is one for "general injuries". Identify one

Journal entries for issuance-first years interest payments

Calculate the issue price of a $1,500,000 bond issue and prepare the journal entries for the issuance and first years' interest payments (use the effective interest method).

Effect on free cash flows

What would be the effect on free cash flows of each of the following items (be sure to include specifically whether "increase" or "decrease/reduce," and by what dollar amou

Shares of common stock concepts

Harry purchased one share of common stock in a computer company for $90. Shortly after he purchased it, the corporation distributed two new shares of common stock for each s


Write a Review

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd