Reference no: EM131116075
Johnny Bravo Company began operations in 2015 and has provided the following information.
1. Pretax financial income for 2015 is $100,000.
2. The tax rate enacted for 2015 and future years is 40%.
3. Differences between the 2015 income statement and tax return are listed below.
1. Warranty expense accrued for financial reporting purposes amounts to $5,000. Warranty deductions per the tax return amount to $2,000.
2. 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.
3. Depreciation of property, plant, and equipment for financial reporting purposes amounts to $60,000.
4. Depreciation of these assets amounts to $80,000 for the tax return.
5. A $3,500 fine paid for violation of pollution laws was deducted in computing pretax financial income.
6. 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 2015.
Draft the income tax expense section of the income statement, beginning with "Income before income taxes"
Attachment:- Spreadsheet.xlsx
|
Number of hours per week
: The number of hours per week American adults spend on home computers is normally distributed with a mean of 4 hours and a standard deviation of 1.5 hour. An American adult is randomly selected.
|
|
Different treatments for depression
: How would we interpret a statistically significant difference in, say, a study comparing different treatments for depression? How would you contrast the interpretation of statistical significance with effect size?
|
|
What are the main distinctions between
: What are the main distinctions between a traditional financial instrument and a derivative financial instrument?
|
|
Work-study students
: During 2008, college work-study students earned a mean of $1478. Assume that a sample consisting of 45 of the work-study students at a large university was found to have earned a mean of $1503 during that year
|
|
Prepare the journal entry to record income tax expense
: Use the spreadsheet Journal Entries to prepare the journal entry to record income tax expense, deferred taxes, and income taxes payable for 2015.
|
|
Percent of us mortgages
: Twenty percent of U.S. mortgages are "underwater" (The Boston Globe, March 5, 2009). A mortgage is considered underwater if the value of the home is less than what is owed on the mortgage. Suppose 100 mortgage holders are randomly selected.
|
|
Budgeted income statement and budgeted balance sheet
: Let us focus on the last three budgets as they are critical to business sustainability and success. What are the contents /format of any one.
|
|
Stemplot of data follows
: A sample of 20 endangered species was obtained and the length of time (in months) since being placed on the list was recorded for each species. A stemplot of these data follows. In the stemplot, 5|2 represents 52 months.
|
|
What is meant by the term underlying as it relates
: What is meant by the term underlying as it relates to derivative financial instruments?
|