Question

In: Accounting

If the taxable income (loss) before LCF from 2016 until 2027 as following each year: -30,000...

If the taxable income (loss) before LCF from 2016 until 2027 as following each year:

-30,000

-21,000

-15,000

9,000

6,000

9,000

12,000

225,000

150,000

-30,000

90,000

240,000

in both case has tax temporary exemption for the first five years and when has no exemption.

Find the following for each year:

LCF

TI after LCF

Tax due if (15% tax rate)

Expert Solution

For the first 5 years no need to pay taxes as Tax temparory exemption; further loss can-not be forward for thses 5 years. Details are as under:

Year	Income before LCF	Tax status	LCF	Taxable Income after LCF	Tax Due
2016	(30,000)	Tax Temparory Exemption	-	-	-
2017	(21,000)	Tax Temparory Exemption	-	-	-
2018	(15,000)	Tax Temparory Exemption	-	-	-
2019	9,000	Tax Temparory Exemption	-	-	-
2020	6,000	Tax Temparory Exemption	-	-	-
2021	9,000	Normal	-	9,000	1,350
2022	12,000	Normal	-	12,000	1,800
2023	225,000	Normal	-	225,000	33,750
2024	150,000	Normal	-	150,000	22,500
2025	(30,000)	Normal	30,000	-	-
2026	90,000	Normal	-	60,000	9,000
2027	240,000	Normal	-	240,000	36,000

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