90.2K

Verified Solution

Link Copied!

Provided is the work that I have done so far. Please be specific when answering the above wrong portions of the question. Thanks for your time!

The long-term Ilabilitles section of CPS Transportation's December 31,2020 , balance sheet included the following: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 ) (Use approprlate factor(s) from the tables provided.) a. A lease llability with 15 remaining lease payments of $28,000 each, due annually on January 1 : The Incremental borrowing rate at the Inception of the lease was 11% and the lessor's Implicit rate, which was known by CPS Transportation, was 10% b. A deferred Income tax Ilability due to a single temporary difference. The only dlfference between CPS Transportation's taxable Income and pretax accounting income is depreclation on a machine acquired on January 1, 2020, for $460,000. The machine's estimated useful life is five years, with no salvage value. Depreciation is computed using the stralght-IIne method for financlal reporting purposes and the MACRS method for tax purposes. Depreclation expense for tax and financlal reporting purposes for 2021 through 2024 is as follows: The enacted federal Income tax rates are 20% for 2020 and 25% for 2021 through 2024 . CPS had a deferred tax liability of $14,500 as of December 31, 2020. For the year ended December 31, 2021, CPS's Income before Income taxes was $860,000. On July 1, 2021, CPS Transportation Issued $560,000 of 9% bonds. The bonds mature in 15 years, and Interest is payable each January 1 and July 1. The bonds were Issued at a price to yleld the Investors 10% CPS records Interest at the effective Interest rate. Requlred: 1. Determine CPS Transportation's income tax expense and net Income for the year ended December 31,2021. 2. Determine CPS Transportation's Interest expense for the year ended December 31, 2021. 3. Prepare the long-term Ilabilltles section of CPS Transportation's December 31,2021 , balance sheet. etermine CPS Transportation's interest expense for the year ended December 31, 2021. (Do not round intermediate alculations. Enter your answers in whole dollars.) Prepare the long-term liabilities section of CPS Transportation's December 31,2021 , balance sheet. (Do not round intermediate calculations. Enter your answers in whole dollars.)

Answer & Explanation Solved by verified expert

See Answer