Arndt, Inc. reported the following for 2021 and 2022 ($ in
2021 2022Revenues$888 $980 Expenses 760 800 Pretax accounting income (income statement)$128 $180 Taxable income (tax return)$116 $200 Tax rate: 25%
- Expenses each year include $30 million from a two-year casualty insurance policy purchased in 2021 for $60 million. The cost is tax deductible in 2021.
- Expenses include $2 million insurance premiums each year for life insurance on key executives.
- Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2021 and 2022 were $33 million and $35 million, respectively. Subscriptions included in 2021 and 2022 financial reporting revenues were $25 million ($10 million collected in 2020 but not recognized as revenue until 2021) and $33 million, respectively. Hint: View this as two temporary differences—one reversing in 2021; one originating in 2021.
- 2021 expenses included a $14 million unrealized loss from reducing investments (classified as trading securities) to fair value. The investments were sold and the loss realized in 2022.
- During 2020, accounting income included an estimated loss of $6 million from having accrued a loss contingency. The loss was paid in 2021, at which time it is tax deductible.
- At January 1, 2021, Arndt had a deferred tax asset of $4 million and no deferred tax liability.
I need help in determining the amount of the casualty insurance expense for the Current year of 2021. I know the future amount is 30million for 2022.
The amount for subscriptions, I can not figure out any of the amounts
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