Sherrod, Inc., reported pretax accounting income of $100 million for 2016. The following information relates to differences between pretax accounting income and taxable income:

Income from installment sales of properties included in pretax accounting income in 2018 exceeded that reported for tax purposes by $8 million. The installment receivable account at year-end had a balance of $10 million (representing portions of 2017 and 2018 installment sales), expected to be collected equally in 2019 and 2020.

Sherrod was assessed a penalty of $4 million by the Environmental Protection Agency for violation of a federal law in 2018. The fine is to be paid in equal amounts in 2018 and 2019.

Sherrod rents its operating facilities but owns one asset acquired in 2017 at a cost of $120 million. Depreciation is reported by the straight-line method assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight-line depreciation the first two years but less than straight-line depreciation the next two years ($ in millions):

Warranty expense of $7 million is reported in 2018. For tax purposes, the expense is deducted when costs are incurred, $4 million in 2018. At December 31, 2018, the warranty liability was $4 million (after adjusting entries). The balance was $1 million at the end of 2017.

In 2018, Sherrod accrued an expense and related liability for estimated paid future absences of $14 million relating to the company’s new paid vacation program. Future compensation will be deductible on the tax return when actually paid during the next two years ($9 million in 2019; $5 million in 2020).

During 2017, accounting income included an estimated loss of $4 million from having accrued a loss contingency. The loss is paid in 2018 at which time it is tax deductible.

Balances in the deferred tax asset and deferred tax liability accounts at January 1, 2018, were $2.0 million and $4.4 million, respectively. The enacted tax rate is 40% each year.

Required:
1. Determine the amounts necessary to record income taxes for 2018 and prepare the appropriate journal entry.
2. What is the 2018 net income?
3. Show how any deferred tax amounts should be classified and reported in the 2018 balance sheet.

Note: I nned help with number 3

Problem 16-7 Multiple differences; calculate taxable income; balance sheet classification [LO16-4, 16-6, 16-8]

Sherrod, Inc., reported pretax accounting income of $90 million for 2018. The following information relates to differences between pretax accounting income and taxable income:

1. Income from installment sales of properties included in pretax accounting income in 2018 exceeded that reported for tax purposes by $3 million. The installment receivable account at year-end had a balance of $4 million (representing portions of 2017 and 2018 installment sales), expected to be collected equally in 2019 and 2020.
2. Sherrod was assessed a penalty of $2 million by the Environmental Protection Agency for violation of a federal law in 2018. The fine is to be paid in equal amounts in 2018 and 2019.
3. Sherrod rents its operating facilities but owns one asset acquired in 2017 at a cost of $100 million. Depreciation is reported by the straight-line method assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight-line depreciation the first two years but less than straight-line depreciation the next two years ($ in millions):

4. Warranty expense of $5 million is reported in 2018. For tax purposes, the expense is deducted when costs are incurred, $3 million in 2018. At December 31, 2018, the warranty liability was $3 million (after adjusting entries). The balance was $1 million at the end of 2017.
5. In 2018, Sherrod accrued an expense and related liability for estimated paid future absences of $10 million relating to the company’s new paid vacation program. Future compensation will be deductible on the tax return when actually paid during the next two years ($7 million in 2019; $3 million in 2020).
6. During 2017, accounting income included an estimated loss of $4 million from having accrued a loss contingency. The loss is paid in 2018 at which time it is tax deductible.

Balances in the deferred tax asset and deferred tax liability accounts at January 1, 2018, were $2.0 million and $3.6 million, respectively. The enacted tax rate is 40% each year.

Required:
1. Determine the amounts necessary to record income taxes for 2018 and prepare the appropriate journal entry.
2. What is the 2018 net income?
3. Show how any deferred tax amounts should be classified and reported in the 2018 balance sheet.

Jay owns a 25% interest in the capital and profits of Grey Company (a calendar year partnership). For tax year 2017, the partnership earned revenue of $800,000 and had operating expenses of $400,000. During the year, Jay withdrew from the partnership a total of $80,000. He also invested an additional $50,000 in the partnership. For 2017, Jay’s gross income from the partnership is:

____   26.   Ron, age 19, is a full-time graduate student at City University. During 2016, he received the following payments:

Ron served as a resident advisor in a dormitory and, therefore, the university waived the $3,500 charge for the room he occupied. What is Ron’s adjusted gross income for 2016?

____   27.   Jerome received a court award in a civil libel suit against Morehouse Inquirer. He received $90,000 for damages to his professional reputation, $80,000 for damages to his personal reutation, and $80,000 in punitive damages. Jerome must include in his gross income as a damage award:

____   28.   Jack’s interest and gains on investments for 2017 were as follows:

Jack’s gross income from the above is:

TOPIC: Importance of ethical behavior for senior management

Objectives : To recognize the role of chair, CEO, executive directors and non-executive directors.

ASSIGNMENT DIRECTION & REQUIREMENT/S (Identify the ILOs to be assessed at the end of each requirement. Include the rubric or marking scheme for each item/requirement.) :

You are the Company Secretary of a large UK multinational company operating in the energy sector. Your company has operations in 25 different countries, some of which are developing economies, and it has raised debt finance, as well as equity finance, in 15 of these countries. You are aware that there have been protests from environmental lobby groups in several areas regarding oil pipelines. There have also been demonstrations about the impact of operations on local communities. Your company has an internal audit committee, an audit committee, and a reasonably well-developed system of internal control loosely structured around the Turnbull Report's recommendations. However, the board has decided that perhaps it should form a new committee, a 'risk committee', which will deal with risk management and internal control specifically. Accordingly, the board has asked you to prepare a briefing paper which summarizes the main risks facing the business at present,

1. Examine the faults which were not considered while arranging the pipelines?

2. Analyze the internal and external risk as those are important to the business, and highlight where the primary exposures are likely to be?

This is all information available

Modify your program from Learning Journal Unit 7 to read dictionary items from
a file and write the inverted dictionary to a file. You will need to decide on
the following:

    * How to format each dictionary item as a text string in the input file.
    * How to convert each input string into a dictionary item.
    * How to format each item of your inverted dictionary as a text string in
      the output file.

Create an input file with your original three-or-more items and add at least
three new items, for a total of at least six items.

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The Unit 7 program:

Dr_Appointments = {'Mom':[2, 'April', 2020], 'Brother':[6, 'July', 2020], 'Sister':[6, 'January', 2021], }

def invert_dict(d):
inverse = dict()
for key in d:
    val = d[key]
    for val in val:
      if val not in inverse:
        inverse[val] = [key]
      else:
        inverse[val].append(key)
return inverse

print('Dr. Appointments:', Dr_Appointments)

print('Inverted Dr. Appointments:')
Invert_Appointments = invert_dict(Dr_Appointments)
print(Invert_Appointments)

This is the expanded dictionary: the Unit 7 plus three more:

Mom: 2, April, 2020,
Brother: 6, July, 2020,
Sister: 6, January, 2021,
Aunt: 2, December, 2021,
Uncle: 6, November, 2021,
Niece: 2, December, 2020

THREE FINANCE for BUSINESS QUESTIONS, ~all unrelated to each other

1. Alpha Company invests $15,600 at an interest rate of 14% for five years. What is the difference between simple and compound interests? Assume that in case the interest rate compounds semiannually.

2. Let’s assume there is a firm that wants to invest $34,000 in a project with an interest rate of 9% annually, and that the project will last for twelve years. What will be the interests coming from the project if the firm chooses not to reinvest any of its earnings? Assume the interest rate compounds annually.

3. Let us assume there is a project that will bring in $38,509.42 six years from now, assuming the interest rate of 9.6% that will compound monthly. What is the project’s present value?

1-Assume that a currency’s spot and futures price are the same, and the currency’s interest rate is higher than the U.S. rate. If US investors wish to lock in the higher foreign return (and limit risk), what effect will the actions of U.S. investors have on the currency’s spot rate? the currency’s futures price?

2- Your company expects to receive 5,000,000 Japanese yen 60 days from now. You decide to hedge your position by selling Japanese yen forward. The current spot rate of the yen is $.0089, while the forward rate is $.0095. You expect the spot rate in 60 days to be $.0090. How many dollars will you receive for the 5,000,000 yen 60 days from now?

Accounts receivable transactions are provided below for J Pharoah Co.

Dec. 31, 2020 The company estimated that 4% of its accounts receivable would become uncollectible. The balances in the Accounts Receivable account and Allowance for Doubtful Accounts were $661,000 and $2,700 (debit), respectively.

Mar. 5, 2021 The company determined that R. Mirza’s $3,500 account and D. Wight’s $6,900 account were uncollectible. The company’s accounts receivable were $691,400 before the accounts were written off.

June 6, 2021 Wight paid the amount that had been written off on March 5. The company’s accounts receivable were $650,600 prior to recording the cash receipt for Wight.

1) Post the journal entries to Allowance for Doubtful Accounts and calculate the new balance after each entry. Allowance for Doubtful Accounts Date Explanation Ref. Debit Credit Balance Dec. 31, 2020 Balance unadjusted Debit Dec. 31, 2020 AJE Mar. 5, 2021 Write off Mirza Mar. 5, 2021 Write off Wight June 6, 2021 Reverse write off

Vargas Company has 35 employees who work 8-hour days and are paid hourly. On January 1, 2019, the company began a program of granting its employees 10 days of paid vacation each   year. Vacation days earned in 2019 may first be taken on January 1, 2020. Any days not taken in one year can be carried forward for up to two years. Information relative to these employees is as follows: (5 points)

                   Hourly              Vacation Days Earned    Vacation Days Used

Year            Wages               by Each Employee         by Each Employee

2019           $11.50                             10                                       0

2020             12.50                             10                                       8

Vargas has chosen to accrue the liability for compensated absences at the current rates of pay in effect when the compensated time is earned.  

a. What is the amount of expense relative to compensated absences that should be reported on Vargas’s income statement for 2019?  (To receive credit for your answer, you must show all supporting computations.)

b. What is the amount of the accrued liability for compensated absences that should be reported at December 31, 2020? (To receive credit for your answer, you must show all supporting computations.)