This year Truckit reported taxable income of $160,000 and received $20,000 of municipal interest. Truckit paid $55,000 in entert

Question

3 years ago

7

This year Truckit reported taxable income of $160,000 and received $20,000 of municipal interest. Truckit paid $55,000 in entert

ainment expenses and $15,000 in fines and penalties Truckit had $50,000 of accumulated E&P at the beginning of the year. What is Truckit’s current E&P?

Business

1 answer:

Lynna [10] · Answer 1 · 2021-11-30T19:45:32+03:00

Answer: $76,400

Explanation:

GIVEN THE FOLLOWING :

TAXABLE INCOME = $160,000

MUNICIPAL INTEREST = $20,000

ENTERTAINMENT EXPENSE = $55,000

FUN.

CURRENT E&P = (taxable income + interest) - (expenses + Tax deduction).

CURRENT E&P = $160,000 + $20000 - (55000 + 15000 + (160,000*0.21))

CURRENT E&P = 160000 + 20000 - 55000 - 15000 - 33600)

THEREFORE CURRENT E&P = $76,400