ACC 100 C Intermediate Accounting III Midterm
Intermediate Accounting IIIMidterm: 10 Questions1)______________________income is reported on the revenue assertion and is also known as revenue earlier than revenue taxes. ______________________is reported on the tax return and is the quantity upon which a company’s revenue taxes payable are computed.a.Pretax monetary revenue; bookb.Taxable revenue; pretax monetary incomec. Ebook; taxable incomec. Pretax monetary revenue; Taxable Revenue 2)Andy McDowell Co. establishes a $100 million legal responsibility on the finish of 2014 for the estimated site-cleanup prices at two of its manufacturing amenities. All associated closing prices will probably be paid and deducted on the tax return in 2015. Additionally, on the finish of 2014, the corporate has $50 million of short-term variations as a consequence of extra depreciation for tax functions, $7 million of which can reverse in 2015.The enacted tax fee for all yr is 40%, and the corporate pays taxes of $64 million on $160 million of taxable revenue in 2014. McDowell expects to have taxable revenue in 2015.i)Decide the deferred tax asset & deferred tax legal responsibility to be reported on the finish of 2015.a.60,000,000; 20,000,000b.20,000,000; 40,000,000c.40,000,000; 60,000,000d.40,000,000; 20,000,0003)TMR Inc. reviews the follows the next pretax revenue (loss) for each e book and tax functions. (Assume the carryback provision is used the place potential for a internet working loss). The tax fee listed had been all enacted by starting of 2012.Yr Pretax Revenue (loss) Tax Price2012 $120,000 40%2013 $90,000 40%2014 (280,000) 45%2015 120,000 45%What are the journal entries for years 2012-2015 to report revenue tax expense (profit) and revenue taxes payable (refundable), and the tax results of the loss carryback and loss carryforward, assuming that based mostly on the burden of accessible proof, it's extra seemingly than not that one-half of the advantages of the loss carryforward is not going to be realized.aFor 2012: For 2013:Revenue tax expense 48,000 Revenue tax expense 36,000 Revenue taxes payable 48,000 Revenue taxes payable 36,000b.For 2012: For 2013:Revenue tax expense 36,000 Revenue tax expense 48,000 Revenue taxes payable 36,000 Revenue taxes payable 48,000c.For 2012: For 2013:Revenue tax expense 48,000 Revenue tax expense 54,000 Revenue taxes payable 48,000 Deferred tax asset 31,500 Revenue taxes payable 22,500d.For 2012: For 2013:Revenue tax expense 15,750 Revenue tax expense 36,000 Revenue taxes payable 15,750 Revenue taxes payable 36,0004)Leasing Co. leases a brand new machine that has a value and truthful worth of $95,000 to Purchaser Co. on a Three-year noncancelable contract. Purchaser Co. agrees to imagine all dangers of regular possession together with such prices as insurance coverage, taxes, and upkeep. The machine has a Three-year helpful life and no residual worth. The lease was signed on January 1, 2014, Leasing Co. expects to earn a 9% return on its funding. The annual leases are payable on every December 31.Full the amortization schedule that may be appropriate for each the lessor and the lessee and that covers all of the years concerned. Schedule of Curiosity and AmortizationRent Receipt/ PaymentInterest Income/ ExpenseReduction of PrincipalReceivable/ Liability1/1/14———$__a_____12/31/14$___b_____$_____c___$28,98066,020a.(a) 95,000; (b) $34,432; (c) $eight,550b. (a) 95,000; (b) $eight,550; (c) $37,530c. (a) 95,000; (b) $37,530; (c) $eight,550d. (a) 95,000; (b) $37,530; (c) $5,9425) AAA Firm sponsors an outlined profit pension plan for its staff. The next knowledge relate to the operation of the plan for the yr 2014 during which no advantages had been paid.-Actuarial current worth of future advantages earned by staff for providers rendered in 2014 amounted to $56,000.-The company’s funding coverage requires a contribution to the pension trustee amounting to $145,000 for 2014.-As of Jan 1, 2014, the corporate had a projected profit obligation of $900,000, an gathered profit obligation of $800,000, and a debit stability of $400,000 in gathered OCI (PSC). The truthful worth of pension plan belongings amounted to $600,000 firstly of the yr. The precise and anticipated return on plan belongings was $54,000. The settlement fee was 9%. No good points or losses occurred in 2014 and no advantages had been paid.-Amortization of prior service price was $50,000 in 2014. Amortization of internet good points or loss was required in 2014.Decide the pension expense (quantities of parts of pension expense must be acknowledged by the corporate in 2014).a.$133,000b.$187,000c.$52,000d.$83,0006) Amnon Company reported the next for 2011:Service price $366Curiosity on P.B.B. 737Return on plan belongings 593Amortization of prior service price 13Amortization of internet loss 154Pc the 2011 pension expense.a.$664,000,000b.$677,000,000 c.$523,000,000c.$1,270,000,0007) At December 31, 2014, Appleton Corp had a deferred tax legal responsibility of $25,000. At December 31, 2015, the deferred tax legal responsibility is $42,000. The corporation’s 2015 present tax expense is $48,000. What quantity ought to Appleton Corp report as whole 2015 revenue tax expense? a.$17,000b.$48,000c.$90,000d.$65,0008)JKF Company owns gear that price $80,000 and has a helpful lifetime of eight years with no salvage worth. On January 1, 2014, JKF leases the gear to DHI Corp for one yr with one rental fee of $15,000 on January 1. What's the 2014 depreciation expense?a.$eight,000b.$10,000c.$15,000d.$20,0009)Ebook foundation of depreciable belongings for Metcalf Co. is $900,000, and the tax foundation is $700,000 on the finish of 2015. The enacted tax fee is 34% for all durations. Decide the quantity of deferred taxes to be reported on the stability sheet on the finish of 2015.a.$544,000b.$238,000c.$306,000d.$68,00010-Full the next statements by filling within the blanks.a)In a interval during which a taxable short-term distinction reverses, the reversal will trigger taxable revenue to be __________________ (lower than, higher than) pretax monetary revenue.b)If a $76,000 stability in Deferred Tax Asset was computed by use of a 40% fee, the underlying cumulative short-term distinction quantities to $____________________.c)Deferred taxes ________________(are, usually are not) recorded to quantity for everlasting variations.d)if a taxable short-term distinction originates in 2014, it would trigger taxable revenue for 2014 to be _________ (lower than, higher than) pretax monetary revenue for 2014.e)If whole tax expense is $50,000 and deferred tax expense is $65,000, then the present portion of the expense computation is known as present tax _______________(expense, profit) of $__________.a. (a)higher than;(b)$190,000;(c)are ;(d)higher than; (e)profit;$15,000b.(a)higher than;(b)$190,000;(c)usually are not;(d)lower than; (e)profit;$15,000 c. (a)higher than;(b)$190,000;(c)are ;(d)lower than; (e)expense;$15,000d. (a)lower than;(b)$190,000;(c)are ;(d)lower than; (e)expense;$15,000