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Homework answers / question archive / Angel Corporation reported pretax book income of $ 1,000,000
Angel Corporation reported pretax book income of $ 1,000,000. During the current year, the net reverse for warranties increase by $ 25,000. In addition, tax depreciation exceed book depreciation by $ 100,000. Finally, Angel subtracted a dividends received deduction of $ 25,000 in computing its current-year taxable income. Angel's hypothetical tax expense in its reconciliation of its income tax expense is:
Angel's hypothetical tax expense in its reconciliation of its income tax expense is: $ 210000
Explanation:
Hypothetical tax expenses= Pretax book income* Tax rate
= $ 1000000* 21%
= $ 210000
