Please give the completely work on Sunday, Feb 13th, before 12Pm with Chicago timezone.
Banjo Company is a subchapter C company situated in Champaign, IL, and is a consumer of your accounting agency. Banjo Corp. manufactures and sells musical devices by their webstore and bodily location. The supervisor on the engagement assigned you to organize the e book to tax reconciliation under. The supervisor want to remind you that the reconciliation format ought to be such that the column labeled “E-book”, which is Banjo’s e book revenue and loss assertion, plus the column labeled “E-book-tax variations” ought to equal the column labeled “Tax”(signal +/- issues). Banjo sometimes has gross earnings a lot higher than $26m and is due to this fact required to make use of accrual foundation for tax functions. Present your work for calculations and any potential limitations.
Banjo Corp. Revenue and Loss for the Yr Ended December 31, 2021
E-book
E-book-tax Distinction
Tax
Gross sales
$ 125,350,000
Curiosity earnings
$ 1,200,000
Earnings from Investments
$ eight,000,000
Capital achieve (loss)
$ (three,750,000)
Salaries
$ (50,000,000)
Worker advantages
$ (12,000,000)
Utilities
$ (800,000)
Repairs and upkeep
$ (2,500,000)
Provides
$ (17,000,000)
Lease
$ (10,000,000)
Dangerous debt expense
$ (800,000)
Insurance coverage
$ (1,500,000)
Meals
$ (900,000)
Leisure
$ (825,000)
Journey
$ (1,100,000)
Enterprise curiosity expense
$ (7,500,000)
Charitable contributions
$ (5,000,000)
Depreciation
$ (10,000,000)
DRD
Web
$ 10,875,000
Further details about Banjo Corp:
1. All of the charitable contributions have been made in money.
2. Meals all had a legitimate enterprise objective and have been all bought from a restaurant.
three. Leisure was for numerous actions throughout which Banjo performed conferences with vital prospects and suppliers.
four. Banjo had no ground plan financing.
5. Curiosity earnings included $260,000 from a Prepare dinner County bond subject to fund municipal property enhancements.
6. A assessment of the accounts receivable subledger revealed the following accounts which might be deemed to be uncollectible:
a. Jack Rabbit Studios $111,000
b. Miles of Chords $280,000
c. Nationwide Instrument Gross sales $146,000
d. Barry’s Banjo Bin $600,000
e. Energy Notes $317,000
7. Banjo obtained $2,000,000 of dividends from Billy’s Band, Inc. through which Banjo owns a three% share.
eight. Banjo additionally obtained $2,000,000 of dividends from Musical Manny’s, Inc. through which Banjo owns at 40% share. Included in Earnings from Investments is $four,000,000 which is Banjo’s 40% share of Musical Manny’s earnings.
9. Banjo’s MACRS depreciation schedule exhibits a complete of present yr depreciation of $eight,250,000.
10. Not included in the MACRS depreciation is the price restoration for the following belongings positioned in service throughout 2020 (these have been the solely belongings positioned in service throughout the yr: Asset Date Price
pc gear four/2/2021 $150,000
supply truck 9/12/2021 $250,000
storage constructing 11/1/2021 $5,000,000
Banjo chooses to say the most quantity of depreciation allowable underneath the legislation.
11. Banjo’s CEO has a compensation bundle which included the following expenditures for 2020:
a. Money compensation $800,000
b. Efficiency bonus $100,000
c. Non-taxable fringe advantages $200,000
d. Taxable fringe advantages $300,000
12. Journey contains expenditures all have a legitimate enterprise objective.
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Please end the work by Sunday, February 13th, before 12 p.m. in the Chicago timezone.
Banjo Company is a consumer of your accounting agency and a subchapter C company based mostly in Champaign, Illinois. Banjo Corp. makes and sells musical devices each on-line and in individual. The supervisor on the engagement delegated to you the process of getting ready the e book to tax reconciliation listed under. The supervisor would need to remind you that the reconciliation format ought to be arrange in order that the column labeled “E-book,” which is Banjo’s e book revenue and loss assertion, plus the column labeled “E-book-tax disparities,” equals the column labeled “Tax” (signal +/- vital). Banjo typically has gross earnings in extra of $26 million and is thus compelled to undertake the accrual technique for tax functions. Show your work for
