Question

ABC reports income tax expense of $800,000. Income tax payable at the beginning and end of the year are $50,000 and $70,000, respectively. What is the amount of cash paid for income taxes

Answer 1

Answer: $780,000

Explanation:

Income taxes paid for the year are:

Cash paid for income taxes =  Beginning income tax payable + Income tax expense - Ending income tax payable

= 50,000 + 800,000 - 70,000

= $780,000