Answer:
Mathis Co.
The Tax payable for 2020 is:
= $1,320,000
Explanation:
a) Data and Calculations:
2020 Financial income = $1,200,000
add Litigation expense 3,000,000
add installment sales 2,400,000
Adjusted taxable income $6,600,000
Income tax rate = 20%
Tax payable for 2020 = $1,320,000
b) The litigation expense was deducted from the financial income. This is added back to the income. Installment sales were not included in the revenue for the financial income of 2020. This is also added to the financial income. The net result is the figure for taxable income. This forms the basis for the application of the income tax rate of 20%.
Answer:
$2,593,000
Explanation:
The computation of consolidated net income is shown below:-
cancellation of excess of Interest expenses over Income = Interest expense - Interest income
= $80,000 - $37,000
= $43,000
Consolidated net income = Parent company Income + Subsidiary Income + cancellation of excess of Interest expenses over Income
= $1,850,000 + $700,000 + $43,000
= $2,593,000
So, for computing the consolidated net income we simply applied the above formula.
Answer:
journal entry based on straight line method are given below
Explanation:
given data
issues = $570,000
rate = 8.5 %
time = 4 year
issued = $508,050
market rate = 12%
to find out
prepare journal entry
solution
journal entry based on straight line method
date general journal Debit Credit
June 30 bond interest expenses $31969
Discount on Bonds payable $7744
= (570000-508050 ) ÷ 8
Cash = 570000 × 8.5% ÷ 2 $24225
December 31 Bond interest expense $31969
Discount on Bonds payable $7744
= (570000-508050 ) ÷ 8
Cash = 570000 × 8.5% ÷ 2 $24225
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