A company is preparing financial statements using IFRS for the first time for the year ended December 31, 2018. The "transition
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Answer:
Flip's taxable income for the current year is $2,10,000.
Explanation:
Given information:
Advertising Expenses = $50,000
Cost of Goods Sold = $660,000
Other Operating Expenses = $390,000
Sales = $1,830,000
Wages and Salaries = $520,000
Capital Gain = $15,000
The formula for taxable income is
Taxable income for corporation = Gross Sales - cost of goods sold - operating expense - Interest expense - Tax deduction/ credit
Where,
Operating expense = Advertising Expenses + Wages and Salaries + Other Operating Expenses
Using this formula we get
Therefore, Flip's taxable income for the current year is $2,10,000.