1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Aleksandr-060686 [28]
4 years ago
5

TPW, a calendar year taxpayer, sold land with a $535,000 tax basis for $750,000 in February. The purchaser paid $75,000 cash at

closing and gave TPW an interest-bearing note for the $675,000 remaining price. In August, TPW received a $55,950 payment from the purchaser consisting of a $33,750 principal payment and a $22,200 interest payment. In the first year after the year of the sale, TPW received payments totaling $106,900 from the purchaser. The total consisted of $67,500 principal payments and $39,400 interest payments.
a. For the first year after the year of the sale, compute the difference between TPW’s book and tax income resulting from the installment sale method.
b. Using a 35 percent tax rate, determine the effect of the difference on the deferred tax asset or liability generated in the year of sale.
Business
1 answer:
statuscvo [17]4 years ago
6 0

Answer:

Explanation:

Amount realized on sale:

Cash                                                                 $75,000

Purchaser’s note 675,000

                                                                                         $750,000

Adjusted basis (535,000)

Gain realized on sale $215,000

b. $215,000 gain realized ÷ $750,000 contract price = 28.67% gross profit percentage.

Cash received in year of sale:

Cash at closing                                             $75,000

August principal payment 33,750

                                                                                       $108,750

Gain recognized   (108750*28.67%) $31,179

A. Book gain                                     $215,000

Tax gain (31,179)

Book/tax difference                                       $183,821

B. $183,821 × 35% = $64,338 deferred tax liability

The excess of book gain over tax gain is a favorable difference.

You might be interested in
Kassandra Young is a business manager at Weith Productions. Although she does not have a background in technology, her job requi
Vadim26 [7]

Answer:

D. Dashboard

Explanation:

Dashboard: It is a tool that allows the user to have a glance of multiple information in one platform, it helps to take insight and do performance analysis with the required key performance indicator. It is very powerful tool used in corporate management as it summarizes the complex data into easier and relevant information as required for a particular department or business. It makes a manager´s job easier and effective decision making.

6 0
3 years ago
At Davide Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. O
soldi70 [24.7K]

Answer and Explanation:

For materials

Equivalent completed units = Completed units + WIP ending

= 111,700 + 20,300

= 132,000 units

Cost of materials = Beginning WIP + Cost of materials added

= 22,300 + 370,000

= $392,300

Cost of material per units = 392,300 ÷ 132,000

= $2.97197

For conversions

Equivalent completed units = Completed units + WIP ending

= 111,700 + 20,300 × 30%

= 117,790 units

Cost of Conversion = Beginning WIP + Cost of conversion added

= 19,700 + 280,000

= $299,700

Cost of conversion per units = 299,700 ÷ 117,790

= $2.54436

Total cost of units completed and transferred out

= 111,700 × (2.97197 + 2.54436)

= $616,174

4 0
3 years ago
Which of the following would NOT cause a shift in supply? A. changes in the price of inputs B. changes in the price of other goo
adell [148]

Answer:

C.

Explanation:

<em>The correct answer would be changes in consumer input.</em>

The supply of a good can be influenced by changes in the price of inputs for that goods, changes in the price of substitute goods, as well as changes in technology that positively or negatively affect the production of such goods.

What will not affect the supply of any good is changes to consumer's input. An input generally referred to a substance that is required to produce an output. Unless the consumer of a good is also the producer of that good, a consumer's input will not impact the supply of a product.

The correct option is C.

4 0
3 years ago
In order to implement contractionary policy, the government and central bank must _____ goverment spending _______ taxes, and __
Vedmedyk [2.9K]

Answer:

increase, decrease, decrease

Explanation:

3 0
3 years ago
Douclamp, a steel manufacturing company, makes small investments in three iron ore plants in different cities. When one of the p
Bess [88]

Answer: Options-based planning

Explanation:

The Option based planning is one of the concept that helps in maintain the flexibility of the various types of plans for making the various types of investments.

The main purpose of the option based planning is that it helps in maintaining the slack resources are are specifically used in the for  of extra resource for the purpose of adapting the various types of changes and also the problems.

According to the given question, the Douclamp is one of the type of manufacturing company that basically making small level of investments on the iron ore plant.

Therefore, Douclamp is using the options based planning based on the given scenario.  

8 0
3 years ago
Other questions:
  • At January 1, 2019, Deer Corp. has beginning inventory of 2,000 surfboards. Deer estimates it will sell 10,000 units during the
    13·1 answer
  • For the case of a perfectly price-discriminating monopolist (ppdm), producer surplus can be calculated as:
    5·1 answer
  • Hello im Michal the fox how may tails i have three,two or,four
    8·2 answers
  • Pereot fragrances states that they are a "moving, flexible, innovative, customer-oriented global company that delivers real valu
    7·1 answer
  • Sam and Ann Hoyt filed a joint federal income tax return for the calendar year 2019. Among the Hoyts’ cash receipts during 2019
    10·1 answer
  • Looking forward to next year, if Chester’s current cash balance is $17,478 (000) and cash flows from operations next period are
    9·1 answer
  • Letters with already formatted fonts and fields are called
    5·1 answer
  • The objective of financial reporting include all of the following except to provide information that Group of answer choices is
    10·1 answer
  • On July 1, Sterns Co. acquired patent rights for $36,000. The patent has a useful life of 6 years and a legal life of 15 years.
    8·1 answer
  • Just like what Truman Burbank form the movie named truman show: Good morning, and in case I don't see ya, Good afternoon, good e
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!