Order ID:89JHGSJE83839 | Style:APA/MLA/Harvard/Chicago | Pages:5-10 |
Instructions:
The accounting records of Concord Corp., a real estate developer, indicated income before income tax of $861,000 for its year ended December 31, 2020, and of $534,000 for the year ended December 31, 2021. The following data are also available.
1). Concord Corp. pays an annual life insurance premium of $10,300 covering the top management team. The company is the named beneficiary.
2). The carrying amount of the company’s property, plant, and equipment at January 1, 2020 was $1,269,000, and the UCC at that date was $994,000. Concord recorded depreciation expense of $170,000 and $191,000 in 2020 and 2021, respectively. CCA for tax purposes was $194,000 and $169,500 for 2020 and 2021, respectively. There were no asset additions or disposals over the two-year period.
3). Concord deducted $214,000 as a restructuring charge in determining income for 2019. At December 31, 2019, an accrued liability of $198,000 remained outstanding relative to the restructuring, which was expected to be completed in the next fiscal year. This expense is deductible for tax purposes, but only as the actual costs are incurred and paid for. The actual restructuring of operations took place in 2020 and 2021, with the liability reduced to $68,000 at the end of 2020 and to $0 at the end of 2021.
4). In 2020, property held for development was sold and a profit of $58,000 was recognized in income. Because the sale was made with delayed payment terms, the profit is taxable only as Concord receives payments from the purchaser. A 10% down payment was received in 2020, with the remaining 90% expected in equal amounts over the following three years.
5). Non-taxable dividends of $3,280 in 2020 and of $3,470 in 2021 were received from taxable Canadian corporations.
6). In addition to the income before income tax identified above, Concord reported a before-tax gain on discontinued operations of $17,700 in 2020.
7). A 30% rate of tax has been in effect since 2018.
Concord Corp. follows IFRS.
Determine the balance of any deferred tax asset or liability accounts at December 31, 2019, 2020, and 2021. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Determine 2020 and 2021 taxable income and current tax expense. (Do not leave any answer field blank. Enter 0 for amounts.
2020 | 2021 | ||||
Continuing Operations: | |||||
Taxable income | $ | $ | |||
Current income tax expense | $ | $ | |||
Discontinued operations: | |||||
Taxable income | $ | $ | |||
Current income tax expense | $ | $ |
Prepare the journal entries to record current and deferred tax expense for 2020 and 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select “No Entry” for the account titles and enter 0 for the amounts.)
Date | Account Titles and Explanation | Debit | Credit |
December 31, 2020 | Current Tax ExpenseDeferred Tax AssetDeferred Tax ExpenseDeferred Tax LiabilityDeferred Tax BenefitCurrent Tax Expense – Discontinued OperationsNo EntryIncome Tax Payable | ||
Deferred Tax LiabilityDeferred Tax ExpenseDeferred Tax BenefitDeferred Tax AssetIncome Tax PayableCurrent Tax ExpenseNo EntryCurrent Tax Expense – Discontinued Operations | |||
Income Tax PayableDeferred Tax LiabilityDeferred Tax BenefitCurrent Tax ExpenseCurrent Tax Expense – Discontinued OperationsDeferred Tax AssetDeferred Tax ExpenseNo Entry | |||
(To record current tax expense) | |||
December 31, 2020 | Deferred Tax ExpenseCurrent Tax ExpenseDeferred Tax LiabilityNo EntryDeferred Tax AssetIncome Tax PayableCurrent Tax Expense – Discontinued OperationsDeferred Tax Benefit | ||
Deferred Tax ExpenseDeferred Tax AssetDeferred Tax LiabilityNo EntryIncome Tax PayableDeferred Tax BenefitCurrent Tax Expense – Discontinued OperationsCurrent Tax Expense | |||
(To record deferred tax expense) |
Date | Account Titles and Explanation | Debit | Credit |
December 31, 2021 | Current Tax Expense – Discontinued OperationsDeferred Tax ExpenseDeferred Tax AssetNo EntryCurrent Tax ExpenseDeferred Tax BenefitIncome Tax PayableDeferred Tax Liability | ||
Deferred Tax BenefitCurrent Tax Expense – Discontinued OperationsNo EntryDeferred Tax AssetDeferred Tax LiabilityDeferred Tax ExpenseIncome Tax PayableCurrent Tax Expense | |||
(To record current tax expense) | |||
December 31, 2021 | Income Tax PayableDeferred Tax ExpenseDeferred Tax LiabilityNo EntryCurrent Tax ExpenseCurrent Tax Expense – Discontinued OperationsDeferred Tax AssetDeferred Tax Benefit | ||
No EntryDeferred Tax LiabilityDeferred Tax AssetCurrent Tax ExpenseCurrent Tax Expense – Discontinued OperationsDeferred Tax ExpenseDeferred Tax BenefitIncome Tax Payable | |||
(To record deferred tax expense)
Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2020 and 2021 balance sheets. Prepare partial income statements for the years ended December 31, 2020 and 2021, beginning with the line “Income from continuing operations before income tax.” (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2020 and 2021 balance sheets if Concord Corp. reported under ASPE. |
RUBRIC |
||||||
Excellent Quality 95-100%
|
Introduction
45-41 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. |
Literature Support 91-84 points The background and significance of the problem and a clear statement of the research purpose is provided. The search history is mentioned. |
Methodology 58-53 points Content is well-organized with headings for each slide and bulleted lists to group related material as needed. Use of font, color, graphics, effects, etc. to enhance readability and presentation content is excellent. Length requirements of 10 slides/pages or less is met. |
|||
Average Score 50-85% |
40-38 points More depth/detail for the background and significance is needed, or the research detail is not clear. No search history information is provided. |
83-76 points Review of relevant theoretical literature is evident, but there is little integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are included. Summary of information presented is included. Conclusion may not contain a biblical integration. |
52-49 points Content is somewhat organized, but no structure is apparent. The use of font, color, graphics, effects, etc. is occasionally detracting to the presentation content. Length requirements may not be met. |
|||
Poor Quality 0-45% |
37-1 points The background and/or significance are missing. No search history information is provided. |
75-1 points Review of relevant theoretical literature is evident, but there is no integration of studies into concepts related to problem. Review is partially focused and organized. Supporting and opposing research are not included in the summary of information presented. Conclusion does not contain a biblical integration. |
48-1 points There is no clear or logical organizational structure. No logical sequence is apparent. The use of font, color, graphics, effects etc. is often detracting to the presentation content. Length requirements may not be met |
|||
You Can Also Place the Order at www.collegepaper.us/orders/ordernow or www.crucialessay.com/orders/ordernow
|