T12S-Chp-05-7-Review-Tax-Accounting

T12S-Chp-05-7-Review-Tax-Accounting - Tab Problem File Page...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Tab: Problem File: f0ccefb1a6ecfa30fe40a17e14dfae12a32ec166.xls Page 1 of 2 Review of Income Tax Accounting vs. GAAP Accounting Principles Charlotte Corporation provided the following information in its first year. Revenue $800,000 Provision for bad debts 9,000 Other expenses 390,000 Amount of bad debts written off during year 5,000 Ending balance in Accounts Receivable 200,000 Entry for write-off: debit the allowance account and credit accounts receivable. Expenses above do not include accrual for federal income taxes or any payment of such taxes. There is no state income tax. Assume federal corporate income tax rate is 40% for all years. The federal income tax law requires that the direct charge-off method be used on the tax return. 1 What is the amount of net income before income tax on the GAAP financial statements? a. $396,000 b. $401,000 c. $405,000 $410,000 e. Other 2 What is the amount of taxable income for the year? a. $396,000 b. $401,000 c. 405,000 $410,000 e. Other 3 What is the amount of income tax expense in the GAAP income statement? a. $158,400 b. $160,400 c. $162,000 $164,000 e. Other 4 What is the amount of income tax payable for the year? a. $158,400 b. $160,400 c. $162,000 $164,000 e. Other 5 a. $591,000 b. $595,000 c. $600,000 $800,000 e. Other Use the following information for the next two questions Jan started JanCorp (corporation) on 1-1-10. JanCorp owns an office building and rents offices to businesses. Tenants usually pay rent for a month on the first day of that month.
Image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern