Exercise 19-20 (Part Level Submission) The differences between the book basis and tax basis of the...

Exercise 19-20 (Part Level Submission)

The differences between the book basis and tax basis of the assets and liabilities of Ivanhoe Corporation at the end of 2016 are presented below.

	Book Basis	Tax Basis
Accounts receivable	$46,000	$0
Litigation liability	28,700	0

It is estimated that the litigation liability will be settled in 2017. The difference in accounts receivable will result in taxable amounts of $29,800 in 2017 and $16,200 in 2018. The company has taxable income of $341,000 in 2016 and is expected to have taxable income in each of the following 2 years. Its enacted tax rate is 34% for all years. This is the company’s first year of operations. The operating cycle of the business is 2 years.

(a)

Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2016. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation	Debit	Credit

B. indicate how deferred income taxes will be reported on the statement of financial position at the end of 2016

Expert Solution

ekkarill92 answered 2 years ago

Exercise 19-24 (Part Level Submission) Blue Inc. reports the following pretax income (loss) for both book...

Exercise 19-24 (Part Level Submission) Blue Inc. reports the following pretax income (loss) for both book and tax purposes. (Assume the carryback provision is used where possible for a net operating loss.) Year Pretax Income (Loss) Tax Rate 2015 $130,000 40 % 2016 94,000 40 % 2017 (307,000 ) 45 % 2018 112,000 45 % The tax rates listed were all enacted by the beginning of 2015. (a) Prepare the journal entries for years 2015–2018 to record income tax expense...

E19.22 (LO1,4) (Two Differences, One Rate, First Year) The differences between the book basis and tax...

E19.22 (LO1,4) (Two Differences, One Rate, First Year) The differences between the book basis and tax basis of the assets and liabilities of Morgan Corporation at the end of 2019 are presented below. Book Basis Tax Basis Accounts receivable $50,000 $–0– Litigation liability 20,000 –0– It is estimated that the litigation liability will be settled in 2020. The difference in accounts receivable will result in taxable amounts of $30,000 in 2020 and $20,000 in 2021. The company has taxable income...

Exercise 21-20 (Part Level Submission) In May 2017, the budget committee of Grand Stores assembles the...

Exercise 21-20 (Part Level Submission) In May 2017, the budget committee of Grand Stores assembles the following data in preparation of budgeted merchandise purchases for the month of June. 1. Expected sales: June $501,200, July $617,100. 2. Cost of goods sold is expected to be 75% of sales. 3. Desired ending merchandise inventory is 30% of the following (next) month’s cost of goods sold. 4. The beginning inventory at June 1 will be the desired amount. Collapse question part (a)...

Exercise 3-19 a-b (Part Level Submission) The following data are taken from the comparative balance sheets...

Exercise 3-19 a-b (Part Level Submission) The following data are taken from the comparative balance sheets of Cullumber Billiards Club, which prepares its financial statements using the accrual basis of accounting. December 31 2020 2019 Accounts receivable from members $13,800 $ 8,000 Unearned service revenue 16,300 24,200 Members are billed based upon their use of the club’s facilities. Unearned service revenues arise from the sale of gift certificates, which members can apply to their future use of club facilities. The...

Exercise 19-23 (Part Level Submission) Spamela Hamderson Inc. reports the following pretax income (loss) for both...

Exercise 19-23 (Part Level Submission) Spamela Hamderson Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Year Pretax Income (Loss) Tax Rate 2018 $120,000 17 % 2019 90,000 17 % 2020 (280,000 ) 19 % 2021 300,000 19 % The tax rates listed were all enacted by the beginning of 2018. (a) Your answer is partially correct. Try again. Prepare the journal entries for the years 2018–2021 to record income tax expense (benefit) and...

Exercise 8-19 (Part Level Submission) Waterway Corporation began operations on December 1, 2019. The only inventory...

Exercise 8-19 (Part Level Submission) Waterway Corporation began operations on December 1, 2019. The only inventory transaction in 2019 was the purchase of inventory on December 10, 2019, at a cost of $25 per unit. None of this inventory was sold in 2019. Relevant information is as follows. Ending inventory units December 31, 2019 200 December 31, 2020, by purchase date December 2, 2020 200 July 20, 2020 50 250 During the year 2020, the following purchases and sales were...

Exercise 20-09 (Part Level Submission) Sheffield Enterprises provides the following information relative to its defined benefit...

Exercise 20-09 (Part Level Submission) Sheffield Enterprises provides the following information relative to its defined benefit pension plan. Balances or Values at December 31, 2020 Projected benefit obligation $2,726,200 Accumulated benefit obligation 1,996,100 Fair value of plan assets 2,263,000 Accumulated OCI (PSC) 210,000 Accumulated OCI—Net loss (1/1/20 balance, 0) 45,900 Pension liability 463,200 Other pension plan data for 2020: Service cost $94,200 Prior service cost amortization 42,100 Actual return on plan assets 130,000 Expected return on plan assets 175,900 Interest...

Exercise 20-10 (Part Level Submission) Oriole Corp. sponsors a defined benefit pension plan for its employees....

Exercise 20-10 (Part Level Submission) Oriole Corp. sponsors a defined benefit pension plan for its employees. On January 1, 2020, the following balances relate to this plan. Plan assets $469,100 Projected benefit obligation 575,200 Pension asset/liability 106,100 Accumulated OCI (PSC) 97,900 Dr. As a result of the operation of the plan during 2020, the following additional data are provided by the actuary. Service cost $90,500 Settlement rate, 8% Actual return on plan assets 56,400 Amortization of prior service cost 18,800...

Exercise 20-11 (Part Level Submission) Sage Company sponsors a defined benefit pension plan for its employees....

Exercise 20-11 (Part Level Submission) Sage Company sponsors a defined benefit pension plan for its employees. The following data relate to the operation of the plan for the year 2017 in which no benefits were paid. 1. The actuarial present value of future benefits earned by employees for services rendered in 2017 amounted to $55,700. 2. The company’s funding policy requires a contribution to the pension trustee amounting to $144,323 for 2017. 3. As of January 1, 2017, the company...

Exercise 20-13 (Part Level Submission) On January 2, 2016, Twilight Hospital purchased a $92,000 special radiology...

Exercise 20-13 (Part Level Submission) On January 2, 2016, Twilight Hospital purchased a $92,000 special radiology scanner from Bella Inc. The scanner had a useful life of 4 years and was estimated to have no disposal value at the end of its useful life. The straight-line method of depreciation is used on this scanner. Annual operating costs with this scanner are $105,000. Approximately one year later, the hospital is approached by Dyno Technology salesperson, Jacob Cullen, who indicated that purchasing...

Question