d. interest expense of $67,552 and depreciation expense of $125,096. QUESTION 11 Stromboli Co. at...
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d. interest expense of $67,552 and depreciation expense of $125,096. QUESTION 11 Stromboli Co. at the end of 2017 , its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: The estimated litigation expense of $2,500,000 will be deductible in 2019 when it is expected to be paid. The gross profit from the installment sales will be realized in the amount of $1,400,000 in each of the next two years. The estimated liability for litigation is classified as noncurrent and the installment accounts receivable are classified as $1,400,000 current and $1,400,000 noncurrent. The income tax rate is 40% for all years. The deferred tax asset to be recognized is a. $1,000,000 noncurrent. b. $480,000 current. c. $360,000 current d. $1,120,000 noncurrent. QUESTION 12 HK Corporation purchased a machine on January 2, 2017, for $4,000,000. The machine has an estimated 5-year life with no salvage value. The straightline method of depreciation is being used for financial statement purposes and the following MACRS amounts will be deducted for tax purposes: Click Save and Submit to save and submit. Click Save All Answers to save all answers
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