Question

JD Corporation has income before tax of $800000. Included in this amount are meals and entertainment...

JD Corporation has income before tax of $800000. Included in this amount are meals and entertainment amounting to $9000, warranty costs of $100000 ($65000) in warranty claims), depreciation $94000 and dividends from a taxable Canadian Corporation of $15000. CCA for the year amounted to $90000 and then the tax rate is 40%. Calculate Income Tax Expense

Homework Answers

Answer #1
JD Corporation Canada
Particulars Amount
Income Before tax 800000
+ Meal & entertainment 9000
- Meal & entertainment(Only 50% allowed as deduction ) 4500
+ Warrant cost 100000
- Warrant cost(Actual Incurred is deductable) 65000
+ Depreciation(Allowed as per Accounting) 94000
- Capital Cost Allowance(CCA)(Allowed as per income tax) 90000
- Dividend(Income Taxed on gross up basis with dividend tax credit) 15000
828500
Incoe tax rate@40% 331400
Net Profit 497100
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The Loquat Corporation has book net income of $139,600 for the current year. included in this...
The Loquat Corporation has book net income of $139,600 for the current year. included in this figure are the following items which are reported on the corporation schedule M1 reconciliation of income loss for goods within camper return. federal income tax expense $20,940 depreciation deduction on the books which is not deductible for tax purposes 27 920 deduction for 50% of meals and entertainment expense which is not allowed for tax purposes 12,564 deduction for a tax penalty not allow...
Summer Co. is preparing the reconciliation between accounting income and taxable income for 2019.   Actual warranty...
Summer Co. is preparing the reconciliation between accounting income and taxable income for 2019.   Actual warranty repairs made in 2019 and allowed to be deducted for tax purposes amounted to $40,000. Warranty expense recorded in 2019 was $30,000. For years before 2019, warranty expense recorded was $60,000 and total repairs made under warranty amounted to $10,000. CCA allowed for tax purposes in 2019 was $65,000; depreciation expense recorded in 2019 was $85,000. For years before 2019, depreciation expense exceeded CCA...
The Loquat Corporation has book net income of $91,000 for the current year. Included in this...
The Loquat Corporation has book net income of $91,000 for the current year. Included in this figure are the following items, which are reported on the corporation's Schedule M-1, Reconciliation of Income (Loss) per Books with Income per Return. • Federal income tax expense $13,650 • Depreciation deducted on the books which is not deductible for tax purposes 18,200 • Deduction for 50 percent of meals and entertainment expense which is not allowed for tax purposes 8,190 • Deduction for...
Spring Time Corp. has income before tax expense of $150,000 for 2019. $25,000 dividends were received...
Spring Time Corp. has income before tax expense of $150,000 for 2019. $25,000 dividends were received in 2019. This amount is not taxable. A $5,000 fine expensed in 2019 is not deductible for tax purposes. CCA allowed for tax purposes in 2019 was $75,000; depreciation expense recorded in 2019 was $90,000. For years before 2019, total depreciation expense was higher than total CCA by $50,000. QUESTION On the reconciliation between accounting income and taxable income, how would the $5,000 non-deductible...
Cramer Corporation, a calendar year, accrual basis corporation, reported $1.45 million of net income after tax...
Cramer Corporation, a calendar year, accrual basis corporation, reported $1.45 million of net income after tax on its 2018 financial statements prepared in accordance with GAAP. The corporation’s books and records reveal the following information: Cramer's federal income tax expense per books was $209,000. Cramer's book income included $19,000 of dividends received from a domestic corporation in which Cramer owns a 25 percent stock interest, and $8,500 of dividends from a domestic corporation in which Cramer owns a 5 percent...
Mary operates a proprietorship that generated $200,000 in income under GAAP. Included in this amount are:...
Mary operates a proprietorship that generated $200,000 in income under GAAP. Included in this amount are: ·   $20,000 of amortization expense; ·   $10,000 for bad debt expense; ·   $150,000 cost of goods sold; and ·   $16,000 meals and entertainment with clients. Mary’s maximum CCA has been calculated at $25,000 for the year. How much is Mary’s business income for tax purposes? a.203,000 b.220,000 c.228,000 d. 234,000
The Loquat Corporation has book net income of $217,000 for the current year. Included in this...
The Loquat Corporation has book net income of $217,000 for the current year. Included in this figure are the following items, which are reported on the corporation's Schedule M-1, Reconciliation of Income (Loss) per Books with Income per Return. • Federal income tax expense $32,550 • Depreciation deducted on the books which is not deductible for tax purposes 43,400 • Deduction for 50 percent of meals expense which is not allowed for tax purposes 19,530 • Deduction for a tax...
On 1 January 20X3, Highmark Corp. had the following deferred tax balances: Deferred income tax asset...
On 1 January 20X3, Highmark Corp. had the following deferred tax balances: Deferred income tax asset related to warranty $ 17,000 Deferred income tax liability related to capital assets $ 122,000 On this date, the net book value of capital assets was $1,770,000 and UCC was $1,460,000. There was a warranty liability of $42,000. In 20X3, accounting income was $190,000. This included non-tax-deductible expenses of $44,000, dividend revenue (non-taxable) of $13,000, depreciation of $77,000, and a warranty expense of $40,000....
Determine taxable income in each of the following instances. Assume that the corporation is a C...
Determine taxable income in each of the following instances. Assume that the corporation is a C corporation and that book income is before any income tax expense. Book income of $61,000 including capital gains of $6,000, a charitable contribution of $1,600, and meals and entertainment expenses of $8,500. Book income of $103,000 including capital losses of $7,000, a charitable contribution of $17,500, and meals and entertainment expenses of $2,000. Book income of $81,500 including municipal bond interest of $1,500, a...
M Corporation reported 2019 book net income of $185,000. The following items were included in book...
M Corporation reported 2019 book net income of $185,000. The following items were included in book income for 2018: State A income tax expense $ 15,000 State B income tax expense $ 5,000 Federal income tax expense $49,000 Book depreciation expense $ 18,000 Municipal bond interest income $ 10,000 US government obligation interest income $ 12,000 Dividends received from 5% owned US co. $ 8,000 Separately, M Corporation computed federal tax depreciation of $26,000. A) Based on the above, compute...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT