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2 years ago

Why is it important to understand that the amount cash paid for taxes is different than the amount of income tax expense?

1 answer:

6 0

Answer: To know the amount of tax the business should pay from reported profit which is different from it's actual tax bill

Explanation:

Income tax expense could be described as what is calculated that the company owes in taxes according to accounting rules. They are reported on the income statement.

While Income tax payable is described as the actual amount the company owes in taxes based on the rules of tax code. They appear on the balance sheet of the company accounting documents until the bills are cleared off or paid.

The reason for understanding the difference is to know the amount of tax the business should pay from reported profit which is different from it's actual tax bill

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On January 1, 2019, Upward Company purchased a copy machine. The machine costs $320,000, its estimated useful life is 8 years, a

qwelly [4]

Answer:

$60,000

Explanation:

Depreciation expense using the double declining method = Depreciation factor x cost of the asset

Depreciation factor = 2 x (1/useful life) = 2 / 8 = 0.25

Depreciation expense in 2019 = 0.25 x $320,000 = $80,000

Book value at the beginning of 2020 = $320,000 - $80,000 = $240,000

Depreciation expense in 2020 = 0.25 x $240,000 = $60,000

I hope my answer helps you

6 0

3 years ago

Nona Curry started her own consulting firm, Curry Consulting Inc., on May 1, 2017. The following transactions occurred during th

Yuliya22 [10]

Answer:

Curry Consulting Inc.

Showing the effects of transactions on the accounting equation:

Assets = Liabilities + Equity

May 1:

Assets (Cash + $15,000) = Liabilities + Equity (Common Stock + $15,000)

May 2:

Assets (Cash - $600) = Liabilities + Equity (Retained Earnings - $600)

May 3:

Assets (Supplies +$500) = Liabilities (Accounts Payable +$500) + Equity

May 5:

Assets (Cash - $150) = Liabilities + Equity (Retained Earnings - $150)

May 9:

Assets (Cash + $1,400) = Liabilities + Equity (Retained Earnings + $1,400)

May 12:

Assets (Cash - $200) = Liabilities + Equity (Retained Earnings - $200)

May 15:

Assets (Accounts Receivable +$4,200) = Liabilities + Equity (Retained Earnings +$4,200)

May 17:

Assets (Cash - $2,500) = Liabilities + Equity (Retained Earnings - $2,500)

May 20:

Assets (Cash -$500) = Liabilities (Accounts Payable -$500) + Equity

May 23:

Assets (Cash +$1,200 Accounts Receivable -$1,200) = Liabilities + Equity

May 26:

Assets (Cash +$5,000) = Liabilities (Notes Payable +$5,000) + Equity

May 29:

Assets (Cash -$200 Equipment +$2,000) = Liabilities (Accounts Payable +$1,800) + Equity

May 30:

Assets (Cash - $180) = Liabilities + Equity (Retained Earnings - $180)

Explanation:

The accounting equation shows that Assets = Liabilities + Equity. This equation is the basis of the double-system of accounting. It is always in balance when each transaction is correctly posted. The implication is that every business transaction affects, in two ways, either the assets side or the liabilities and equity side or both.

4 0

2 years ago

The units of an item available for sale during the year were as follows:

ioda

Answer:

FIFO LIFO Weighted Average

Inventory cost = $167,700 $145,600 $157,800

Explanation:

a) Data and Calculations:

Jan. 1 Inventory 1,000 units at $120 $120,000 $120,000

Feb. 17 Purchases 1,375 units at $128 176,000 296,000

July 21 Purchases 1,500 units at $136 204,000 500,000

Nov. 23 Purchases 1,125 units at $140 157,500 657,500

Dec. 31 Total units 5,000 $657,500

Dec. 31 Inventory 1,200

Dec. 31 Units sold 3,800

Inventory cost by:

FIFO ( first-in, first-out method)

July 21 Purchases 75 units at $136 $10,200

Nov. 23 Purchases 1,125 units at $140 157,500

Dec. 31 Inventory 1,200 $167,700

LIFO (last-in, first-out method)

Jan. 1 Inventory 1,000 units at $120 $120,000

Feb. 17 Purchases 200 units at $128 25,600

Dec. 31 Inventory 1,200 $145,600

Weighted-Average Cost Method

Total cost of goods available/Total units available for sale

= $657,500/5,000

= $131.50 per unit

Inventory cost = $157,800 ($131.50 * 1,200)

4 0

2 years ago

A law firm billed a client $1,800 for entries will the firm make to record this transaction? work performed in the current month

Anika [276]

Answer:

E) Debit Accounts Receivable, $1,800; credit Legal Fees Revenue, $1,800

Explanation:

The Journal Entry is as follows :-

Accounts Receivable Dr, $1,800

To Legal fees revenues $1,800

(Being the billing is recorded)

Therefore for passing the journal entry, we debited the Accounts Receivable $1,800 with the credited Legal fees revenues $1,800 so that the proper posting can be done.

7 0

2 years ago

Jay is an 21 year old college senior. He reads on a financial blog that interest rates are being lowered by the Federal Reserve.

IceJOKER [234]

Answer:

Explanation:

6 0

3 years ago

Read 2 more answers