60.1K

Verified Solution

Link Copied!

show m-1 answers as shown on picture

EFG, a calendar year, accrual basis corporation, reported $479,900 net income after tax on its financial statements prepared in accordance with GAAP. The corporation's financial records reveal the following information: - EFG earned $10,700 on an investment in tax-exempt municipal bonds. - EFG's allowance for bad debts as of January 1 was $21,000. Write-offs for the year totaled $4,400, while the addition to the allowance was $3,700. The allowance as of December 31 was $20,300. - On August 7, EFG paid a $6,000 fine to a municipal government for a violation of a local zoning ordinance. - EFG's depreciation expense per books was $44,200, and its MACRS depreciation deduction was $31,000. - This is EFG's second taxable year. In its first taxable year, it recognized an $8,800 net capital loss. This year, it recognized a $31,000 Section 1231 gain on the sale of equipment, This was EFG's only disposition of noninventory assets. - In its first taxable year, EFG capitalized $6,900 of organizational costs for tax purposes and elected to amortize the costs over 180 months. For book purposes, it expensed the costs. - EFG's federal income tax expense per books was $151,000. Required: a. Compute EFG's taxable income and regular tax. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling EFG's book and taxable income. Complete this question by entering your answers in the tabs below. Compute EFG's taxable income and regular tax. Note: Do not round any intermediate division. Round your final answers to the nearest whole dollar amount. Enter yo answers in whole dollars not in millions. - On August 7, EFG paid a $6,000 fine to a municipal government for a violation of a local zoning ordinance. - EFG's depreciation expense per books was $44,200, and its MACRS depreciation deduction was $31,000. - This is EFG's second taxable year. In its first taxable year, it recognized an $8,800 net capital loss, This year, it recognized a $31,000 Section 1231 gain on the sale of equipment. This was EFG's only disposition of noninventory assets. - In its first taxable year, EFG capitalized $6,900 of organizational costs for tax purposes and elected to amortize the costs over 180 months. For book purposes, it expensed the costs. - EFG's federal income tax expense per books was $151,000. - Required: a. Compute EFG's taxable income and regular tax. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling EFG's book and taxable income. Complete this question by entering your answers in the tabs below. Compute EFG's taxable income and regular tax. Note: Do not round any intermediate division. Round your final answers to the nearest whole doliar amount. Enter yoi answers in whole dollars not in millions. Required: a. Compute EFG's taxable income and regular tax. b. Prepare a Schedule M-1, page 6, Form 1120, reconciling EFG's book and taxable income. Complete this question by entering your answers in the tabs below. Prepare a Schedule M-1, page 6, Form 1120, reconciling EFG's book and taxable income. Note: Any Expenses (Line 5) and Deductions (Line 8) that are not included under Depreciation, Charitable Contributio Entertainment should be combined in the corresponding line item "Other". Enter all amounts as positive. Enter your al in millions. Do not round any intermediate division. Reconciliation of Income (Loss) per Books With Income per Return OR FOR ANY PURPOSE OTHER THAN EDUCATIONAL, 2023 McGraw-Hill Education

Answer & Explanation Solved by verified expert

See Answer