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Plano deducts insurance expense of $300,000 for tax purposes in 2018 , but the expense...

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Accounting

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Plano deducts insurance expense of $300,000 for tax purposes in 2018 , but the expense is not yet recognized for accounting purposes. In 2019, 2020, and 2021, no insurance expense will be deducted for tax purposes, but $100,000 of insurance expense will be reported for accounting purposes in each of these years. Plano Company has a tax rate of 30% and income taxes payable of $180,000 at the end of 2018 . There were no deferred taxes at the beginning of 2018. Assuming that income taxes payable for 2019 is $240,000, the income tax expense for 2019 would be what amount? a. $210,000 b. $245,000 c. $240,000 d. $212,000 QUESTION 15 Pusan, Inc. leased equipment from Tower Company under a four-year lease requiring equal annual payments of $450,000, with the first payment due at lease inception. The lease does not transfer ownership, nor is there a bargain purchase option. The equipment has a 4 year useful life and no salvage value. Pusan, Inc.'s incremental borrowing rate is 10% and the rate implicit in the lease (which is known by Pusan, Inc.) is 8%. Assuming that this lease is properly classified as a capital lease, what is the amount of principal reduction recorded when the second lease payment is made in Year 2

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