Atacama Corporation reports a net income before tax for 2018 of $520,000, has a tax...
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Atacama Corporation reports a net income before tax for 2018 of $520,000, has a tax rate of 35% and provides the following selected information (covers both tax difference items) from its ledger as at December 31, 2017 and 2018:
The tax basis of the equipment (book value for tax purposes or the amount of the cost of the asset not yet deducted for tax purposes) is $60,000 at December 31, 2017 and $125,000 as at December 31, 2018. Atacama purchased a new asset in 2018 for $240,000. The tax deduction for warranties is limited to actual warranty payments. During 2018 new legislation was enacted that lowered Atacama Corporations tax rate for 2019 and all subsequent years to 21%.
What was taxable income for 2018?
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