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Black, Inc $\begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\\end{array}$

question 107

Essay

Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 21% corporate tax rate and no valuation allowance. $\begin{array}{lcc}&\text { Tax Debit/(Credit) }&\text { Book Debit/(Credit) }\\\text { Assets }\\\text { Cash } & \$300 & \$300 \\ \text { Accounts receivable } & 5,000 & 5,000 \\ \text { Buildings } & 300,000 & 300,000 \\ \text { Accumulated depreciation } & (150,000) & (80,000) \\ \text { Furniture \& fixtures } & 40,000 & 40,000 \\ \text { Accumulated depreciation } & (21,000) & (15,000) \\\text { Total assets } & \$ 174,300 & \$ 250,300 \\\text { Liabilities } & & \\\text { Accrued litigation expense } & \$-0- & (\$ 27,000) \\\text { Note payable } & (116,000) & \underline{(116,000)} \\\text { Total liabilities } & \underline{(\$ 116,000)} & \underline{(\$ 143,000)} \\\text { Stockholders' Equity } & & \\\text { Paid-in canital } & (\$ 1000) & (\$ 1000)\end{array}$ $\begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\\end{array}$
$Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 21% corporate tax rate and no valuation allowance. \begin{array}{lcc} &\text { Tax Debit/(Credit) }&\text { Book Debit/(Credit) }\\ \text { Assets }\\ \text { Cash } & \$300 & \$300 \\ \text { Accounts receivable } & 5,000 & 5,000 \\ \text { Buildings } & 300,000 & 300,000 \\ \text { Accumulated depreciation } & (150,000) & (80,000) \\ \text { Furniture \& fixtures } & 40,000 & 40,000 \\ \text { Accumulated depreciation } & (21,000) & (15,000) \\ \text { Total assets } & \$ 174,300 & \$ 250,300 \\ \text { Liabilities } & & \\ \text { Accrued litigation expense } & \$-0- & (\$ 27,000) \\ \text { Note payable } & (116,000) & \underline{(116,000)} \\ \text { Total liabilities } & \underline{(\$ 116,000)} & \underline{(\$ 143,000)} \\ \text { Stockholders' Equity } & & \\ \text { Paid-in canital } & (\$ 1000) & (\$ 1000) \end{array} \begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\ \end{array} Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are as follows: Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences. It earned $250 in tax-exempt municipal bond interest and incurred $500 in nondeductible business meals expense. Provide the income tax footnote rate reconciliation for Black, using either dollars or percentages.$ Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are as follows: $Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 21% corporate tax rate and no valuation allowance. \begin{array}{lcc} &\text { Tax Debit/(Credit) }&\text { Book Debit/(Credit) }\\ \text { Assets }\\ \text { Cash } & \$300 & \$300 \\ \text { Accounts receivable } & 5,000 & 5,000 \\ \text { Buildings } & 300,000 & 300,000 \\ \text { Accumulated depreciation } & (150,000) & (80,000) \\ \text { Furniture \& fixtures } & 40,000 & 40,000 \\ \text { Accumulated depreciation } & (21,000) & (15,000) \\ \text { Total assets } & \$ 174,300 & \$ 250,300 \\ \text { Liabilities } & & \\ \text { Accrued litigation expense } & \$-0- & (\$ 27,000) \\ \text { Note payable } & (116,000) & \underline{(116,000)} \\ \text { Total liabilities } & \underline{(\$ 116,000)} & \underline{(\$ 143,000)} \\ \text { Stockholders' Equity } & & \\ \text { Paid-in canital } & (\$ 1000) & (\$ 1000) \end{array} \begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\ \end{array} Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are as follows: Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences. It earned $250 in tax-exempt municipal bond interest and incurred $500 in nondeductible business meals expense. Provide the income tax footnote rate reconciliation for Black, using either dollars or percentages.$ Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest and incurred $500 in nondeductible business meals expense. Provide the income tax footnote rate reconciliation for Black, using either
dollars or percentages.

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Black, Inc Retained earnings (57,300)(106,300)\begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\\end{array} Retained earnings ​(57,300)​(106,300)​

Definitions:

Black, Inc $\begin{array}{llcc} \text { Retained earnings } & (57,300)& (106,300) \\\end{array}$