On January 1, 2013, Ameen Company purchased a building for $42 million. Ameen uses straight-line depreciation...

On January 1, 2013, Ameen Company purchased a building for $42 million. Ameen uses straight-line depreciation for financial statement reporting and MACRS for income tax reporting. At December 31, 2017, the book value of the building was $36 million and its tax basis was $26 million. At December 31, 2018, the book value of the building was $34 million and its tax basis was $19 million. There were no other temporary differences and no permanent differences. Pretax accounting income for 2018 was $50 million.

Required:
1. Prepare the appropriate journal entry to record Ameen’s 2018 income taxes. Assume an income tax rate of 40%.
2. What is Ameen’s 2018 net income?

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ekkarill92 answered 1 year ago

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