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rodikova [14]
3 years ago
5

Sherrod, Inc., reported a pretax accounting income of $76 million for 2011. The following information relates to differences bet

ween pretax accounting income and taxable income:
a. Income from instalment sales of properties included in pretax accounting income in 2011 exceeded that reported for tax purposes by $3 million. The instalment receivable account at year-end had a balance of $4 million (representing portions of 2010 and 2011 instalment sales), expected to be collected equally in 2012 and 2013.

b. Sherrod was assessed a penalty of $2 million by the Environmental Protection Agency for violation of federal law in 2011. The fine is to be paid in equal amounts in 2011 and 2012.

c. Sherrod rents its operating facilities but owns one asset acquired in 2010 at a cost of $80 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 ($20 millions each year):

d. Bad debt expense of $3 million is reported using the allowance method in 2011. For tax purposes, the expense is deducted when accounts prove uncollectible (the direct write-off method): $2 million in 2011. At December 31, 2011, the allowance for uncollectible accounts was $2 million (after adjusting entries). The balance was $1 million at the end of 2010.

e. In 2011, Sherrod accrued an expense and related liability for estimated paid future absences of $7 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 ($4 million in 2012; $3 million in 2013).

f. During 2010, accounting income included an estimated loss of $2 million from having accrued a loss contingency. The loss is paid in 2011 at which time it is tax deductible.

Balances in the deferred tax asset and deferred tax liability accounts at January 1, 2011, were $1.2 million and $2.8 million, respectively. The enacted tax rate is 40% each year.

Required:

1. Determine the amounts necessary to record income taxes for 2011 and prepare the appropriate journal entry.

2. What is the 2011 net income?

3. Show how any deferred tax amounts should be classified and reported in the 2011 balance sheet
Business
1 answer:
kolbaska11 [484]3 years ago
4 0

Answer:Sherrod, Inc. reported pretax accounting income of 76 million for 2011. The following information relates to differences between pretax accounting income and taxable income:

a. Income from installment sales of properties included in pretax accounting income in 2011 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 2010 and 2011 installment sales), expected to be collected equally in 2012 and 2013.

b. Sherrod was assessed a penalty of 2 million by the Environmental Protection Agency for violation of a federal law in 2011. The fine is to be paid in equal amounts in 2011 and 2012.

c. Sherrod rents its operating facilities but owns one asset acquired in 2010 at a cost of 80 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).

Income Statement Tax Returns Differences

2010 $20 $26 $(16)

2011 20 35 (15)

2012 20 12 8

2013 20 7 13

$80 $80 $0

Explanation:

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Ludmilka [50]

Answer:

The sum of the debits will exceed the sum of the credits by $340. (None of the options given).

Explanation:

The right posting on the payment of $210 for the purchase office supplies would be;

Debit office supplies account $210

Credit Cash account $210

However since the debit to office supplies was $550 which is 340 (i.e $550 - $210) more than what the amount to have been posted is, it means that the sum of the debits will exceed the sum of the credits by $340.

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Answer:

C. Take corrective action.

Explanation:

According to the information given to us in the question, we can say that Jimmy's supervisor is taking corrective action when he gives Jimmy suggestions to improve his efficiency. We can determine this because Jimmy has been lacking in productivity and by giving him pointers on how to improve his productivity Jimmy's manager is taking action towards solving a problem.

I hope this answered your question. If you have any more questions feel free to ask away at Brainly.

5 0
3 years ago
The sales and profits of an individual product may not follow the life cycle pattern.A. TrueB. False
Nat2105 [25]

Answer:

A. True

Explanation:

The product life cycle is a term that describes a form of structure or arrangement of sales and profits of a product in a given time.

However, due to volatile marketing conditions, it is TRUE, that the sales and profits of an individual product may or may not follow the life cycle of the general pattern.

Hence, the correct answer in this situations is absolutely TRUE

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Baylor Service Corp. redeemed $1,000 of gift cards that customers used to pay for services that were performed by the company. T
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Answer:

B. Unearned Revenue and a credit to Service Revenue.

Explanation:

The adjusting entry is given below:

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(Being service revenue is recorded)

Here unearned revenue is debited as it decreased the liabilities and credited the service revenue as it increased the revenue

Therefore the option b is correct

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In what career cluster would you find all levels of business jobs, such as an Administrative Assistant?
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In all of these career cluster listed above, you will find all levels of business jobs, such as an Administrative Assistant

For better understanding, let's understand what career clusters means

  • Career Cluster is simply known to be a wide occupational groupings of specific industry based jobs such as agriculture, law, education, health science etc . The career clusters provide an organizing tool that helps one in creating a career plan.
  • An administrative assistant helps in the day to day running of an enterprise or firm. All career cluster have different job specifications and so an office or administrative assistant is often needed to answer phone calls, document important work or minutes of meetings, assistant the boss in office duties and other responsibilities. It is commonly found in all the 16 career cluster.

From the above, we can therefore say that the answer In all of these career cluster listed above, you will find all levels of business jobs, such as an Administrative Assistant is correct.

Learn more about career cluster from:

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7 0
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