Paul Inc, a calendar year C-Corp and accrual method taxpayer,provides the following information and...

90.2K

Verified Solution

Question

Accounting

Paul Inc, a calendar year C-Corp and accrual method taxpayer,provides the following information and wants a Schedule M-1prepared (state which line each amount should be on on ScheduleM-1). Journal entries should also be prepared.
Net Income per Book 535,000
Tax Exempt Interest Income 300
Federal Income Tax Paid 12,000
Life Insurance Proceeds 80,000-received upon death of key employee-the President
Capital Loss 8,000
MACRS Tax Depreciation 200,000 - depreciation taken on the tax return
Book Depreciation 20,000 - depreciation taken for book (financial statement)
Meals and Entertainment 6,000 - reported on financial statement
Journal Entries:
M-1 JournalEntries
Finanial Stmt Debit Credit Tax Return
Expense
Fed Tax Expense
Depreciation Expense
Excess Captial Loss
Meals and Entert. Expense
Tax Exempt Int. Expense
Life Insurance Premiums(key employee
Income:
Tax Exempt Income
Life Insurance Proceeds (key employee)

Answer & Explanation Solved by verified expert

4.4 Ratings (953 Votes)

Financial Statement Debit Credit Tax Return Expense Fed Tax Expense 12000 Depreciation Expense 0 180000 Excess Capital Loss 8000 Meals and Entertainment Expense 6000 Tax Exempt Int Expense 0 Life Insurance premiumsKey employee 0 Income Tax See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

In: AccountingPaul Inc, a calendar year C-Corp and accrual method taxpayer,provides the following information and wants...Paul Inc, a calendar year C-Corp and accrual method taxpayer,provides the following information and wants a Schedule M-1prepared (state which line each amount should be on on ScheduleM-1). Journal entries should also be prepared.Net Income per Book535,000Tax Exempt Interest Income300Federal Income Tax Paid12,000Life Insurance Proceeds80,000-received upon death of key employee-the PresidentCapital Loss8,000MACRS Tax Depreciation200,000 - depreciation taken on the tax returnBook Depreciation20,000 - depreciation taken for book (financial statement)Meals and Entertainment6,000 - reported on financial statementJournal Entries:M-1 JournalEntriesFinanial StmtDebitCreditTax ReturnExpenseFed Tax ExpenseDepreciation ExpenseExcess Captial LossMeals and Entert. ExpenseTax Exempt Int. ExpenseLife Insurance Premiums(key employeeIncome:Tax Exempt IncomeLife Insurance Proceeds (key employee)

Net Income per Book	535,000
Tax Exempt Interest Income	300
Federal Income Tax Paid	12,000
Life Insurance Proceeds	80,000-received upon death of key employee-the President
Capital Loss	8,000
MACRS Tax Depreciation	200,000 - depreciation taken on the tax return
Book Depreciation	20,000 - depreciation taken for book (financial statement)
Meals and Entertainment	6,000 - reported on financial statement

	M-1 JournalEntries
	Finanial Stmt	Debit	Credit	Tax Return
Expense
Fed Tax Expense
Depreciation Expense
Excess Captial Loss
Meals and Entert. Expense
Tax Exempt Int. Expense
Life Insurance Premiums(key employee

Income:
Tax Exempt Income
Life Insurance Proceeds (key employee)