Compute taxable income, Taxation

Kline Company, an accrual basis calendar year corporation, reported $560,000 net income before tax on its financial statements prepared in accordance with GAAP for 2011. Kline's records reveal the following information: (Kline's MTR is 35%. and all items have been properly reported under GAAP).

            . The allowance for bad debts as of January 1, 2011 was $80,000. Write-offs for the year totaled $40,000, and the addition to the allowance for the year was $35,000. The allowance as of December 31 was $75,000.

            . Kline paid a $65,000 fine to the state of Delaware for a violation of state pollution control laws.

            . Kline's lawyers established an estimated fund for a pending lawsuit, which they expect to cost the company $125,000. This liability meets the fixed and determinable standard relating to contingent liabilities. under GAAP

            . Kline received $85,000 in Municipal Bond interest that is not taxable.

            Kline had tax depreciation of $89,000 and book depreciation of $74,000   

Compute Kline's taxable income, and prepare the required journal entry to record the tax expense, tax payable and deferred account, if any.

Posted Date: 2/15/2013 12:59:05 AM | Location : United States







Related Discussions:- Compute taxable income, Assignment Help, Ask Question on Compute taxable income, Get Answer, Expert's Help, Compute taxable income Discussions

Write discussion on Compute taxable income
Your posts are moderated
Related Questions
Ask qmanaging dicrete assignmentuestion #Minimum 100 words accepted#

Individual Retirement Account (IRA) - An IRA is a personal savings plan which allows an individual to make cash contributions per year dependent on individual's adjusted gross inco

evaluate the importance of the principal issue litigated in the case in question using the tax research steps outlined in Appendix A of your text.

Price for 2000 words

The XYZ Corporation has total earnings of $20 million and decides to pay its stockholders a dividend of $8 million. If the corporate tax rate is 30% and the personal tax rate on in


Wyoming Coal Company is interested in buying a machine for $40,000, which it will depreciate uniformly over a four-year period. An analysis of the life expectancy of such machines

83. Dawn Taylor is currently employed by the state Chamber of Commerce. While she enjoys the relatively short workweeks, she eventually would like to work for herself rather than f

In relation to the CGT provisions, which of the following statements are correct? Explain your answer citing the relevant law. (a) When disposal of property (CGT event A1) is by

tds late filing fee code & late filing interest code