Texark inc a calendar year taxpayer reported 5210300 total

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Reference no: EM13370603

Texark Inc., a calendar year taxpayer, reported $5,210,300 total income before tax on its financial statements prepared in accordance with GAAP. The corporation's records reveal the subsequent information.

Depreciation expense per books was $713,700, and MACRS depreciation was 662,000.

Texark exchanged old equipment (-0- tax basis; $44,200 book basis) for new equipment (FMV $50,000). Book gain was added in book income, although the exchange was nontaxable for tax purposes.

Texark received a $100,000 insurance reimbursement for destruction of machinery with a $29,000 tax basis and a $70,000 book basis. Texark spent $110,000 to replace the machinery before year-end.

How do I evaluate taxable income with the above information?

Reference no: EM13370603

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