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scoray [572]
3 years ago
5

A reconciliation of pretax financial statement income to taxable income is shown below for Shaw-Anderson Industries for the year

ended December 31, 2018, its first year of operations. The company offers quality-assurance warranties that extend six months after goods are purchased. The income tax rate is 40%.
Pretax accounting income (income statement) $ 640,000
Interest revenue on municipal securities (20,000 )
Warranty expense in excess of deductible amount 45,000
Depreciation in excess of financial statement amount (120,000 )
Taxable income (tax return) $ 545,000

What amount should Shaw-Anderson report as the current portion of income tax expense on its 2018 income statement?

a.$52,000
b.$218,000
c.$248,000
d.$256,000
Business
1 answer:
Luba_88 [7]3 years ago
3 0

Answer:

B

Explanation:

Year end - December 31,2018 (first account year)

Pretax Income - $640,000

Interest expenses ( $20,000)

Excess warranty expense add back $45,000

Excess depreciation deducted ($120,000)

Taxable income = $545,000

Tax rate = 40%

Income tax expense for 2018 = $545,000 * 40%

=$218,000

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Riemer, Inc. has four departments. Information about these departments is listed below. Maintenance is a service department. If
Norma-Jean [14]

Answer:

a. $3,520.

Explanation:

The computation of the amount of maintenance cost allocated to the Cutting Department is given below:

= maintenance cost ÷ total floor space excluding maintenance cost

= $20,000 ÷ 6,250 × 1,100

= $3,520.

hence, the option is A.$3,520.

The 6,250 comes from

= 1,100 + 2,100 +  3,050

= 6,250

8 0
3 years ago
Suppose wood planks wood planks is a substitute substitute in production of wood beams wood beams. upper a decrease a decrease i
Juli2301 [7.4K]

Answer: Decrease, decrease

Explanation: Substitute goods are those goods that are used in place of each other. When the price of a substitute good falls, it becomes more attractive to the consumers. Here, wood planks and wood beams are substitutes to each other. So, when price of wood plank falls, demand for wood beams will decrease, shifting the demand curve to the left. As a result, of this the equilibrium price of wood beams and the quantity of wood beams will also decrease.

7 0
3 years ago
Read 2 more answers
On May 31, 2018, the Arlene Corporation adopted a plan to sell its cosmetics line of business, considered a component of the ent
asambeis [7]

Answer:

$800,000

Explanation:

The calculation of book value of the assets of the cosmetics component is given below:-

Gain on Sale of the Assets = Income from Operation of a Discontinued Components - Income from Operations

= $620,000 - $300,000

= $320,000

Gain/Loss on Sale of Asset = Sale Value of Assets - Book Value of Assets

= $1,120,000 - $320,000

= $800,000

5 0
3 years ago
What is the term for an interval smaller than a step?.
Svetach [21]

Answer:

Half step

Explanation:

If you're talking about music, then a half step is smaller than a step.

7 0
2 years ago
Ed's Print Shop received an invoice dated May 10 for $2,500 with terms 3/10, 1/15, n/60. On May 22, Ed's Print Shop sent a parti
artcher [175]

Amount to be credited = $2,020

Outstanding balance = $480

Explanation:

The payment terms state that

  • 3% discount may be taken within 10 days of the invoice date (up to May 20); or  
  • 1% discount may be taken within 15 days of the invoice date (after May 20 but not later than May 25); or
  • The net amount is due within 60 days of the invoice date if advantage is not taken of the cash discounts offered.
  • The  3% cash discount is not applicable as the payment was made on May 22 which is after the end of the discount period. However, the 1% discount is allowed, since payment on May 22 is within the 15-day period for the 1% discount.

Amount to be credited

= 2000 / (1−0.01)

= 2000 / (0.99)

= $2,020

Outstanding balance

= 2500 - 2020

= $480

3 0
3 years ago
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