question exercise 19 4 nash company reports pretax financial income of 75 900 for 20 4280008
Question
Exercise 19-4
Nash Company reports pretax financial income of $75,900 for 2017. The following items cause taxable income to be different than pretax financial income.
Nash’s tax rate is 40% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2017.
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Account Titles and Explanation
Debit
Credit
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1. |
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Depreciation on the tax return is greater than depreciation on the income statement by $14,600. |
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2. |
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Rent collected on the tax return is greater than rent recognized on the income statement by $20,000. |
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3. |
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Fines for pollution appear as an expense of $10,000 on the income statement. |