西方财务会计 原版课件19(75页PPT).pptx

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1、Chapter 19-1Chapter 19-2C H A P T E R 19ACCOUNTING FOR INCOME TAXESIntermediate Accounting13th EditionKieso,Weygandt,and Warfield Chapter 19-31.1.Identify differences between pretax financial income and taxable income.Identify differences between pretax financial income and taxable income.2.2.Descri

2、be a temporary difference that results in future taxable amounts.Describe a temporary difference that results in future taxable amounts.3.3.Describe a temporary difference that results in future deductible amounts.Describe a temporary difference that results in future deductible amounts.4.4.Explain

3、the purpose of a deferred tax asset valuation allowance.Explain the purpose of a deferred tax asset valuation allowance.5.5.Describe the presentation of income tax expense in the income statement.Describe the presentation of income tax expense in the income statement.6.6.Describe various temporary a

4、nd permanent differences.Describe various temporary and permanent differences.7.7.Explain the effect of various tax rates and tax rate changes on deferred income taxes.Explain the effect of various tax rates and tax rate changes on deferred income taxes.8.8.Apply accounting procedures for a loss car

5、ryback and a loss carryforward.Apply accounting procedures for a loss carryback and a loss carryforward.9.9.Describe the presentation of deferred income taxes in financial statements.Describe the presentation of deferred income taxes in financial statements.10.10.Indicate the basic principles of the

6、 asset-liability method.Indicate the basic principles of the asset-liability method.Learning ObjectivesChapter 19-4Fundamentals of Fundamentals of Accounting for Income Accounting for Income TaxesTaxesFuture taxable Future taxable amounts and amounts and deferred taxesdeferred taxesFuture deductible

7、 Future deductible amounts and amounts and deferred taxesdeferred taxesIncome statement Income statement presentationpresentationSpecific Specific differencesdifferencesRate considerationsRate considerationsAccounting for Net Accounting for Net Operating LossesOperating LossesFinancial Financial Sta

8、tement Statement PresentationPresentationReview of Asset-Review of Asset-Liability MethodLiability MethodLoss carrybackLoss carrybackLoss carryforwardLoss carryforwardLoss carryback Loss carryback exampleexampleLoss carryforward Loss carryforward exampleexampleBalance sheetBalance sheetIncome statem

9、entIncome statementUncertain tax Uncertain tax positionspositionsAccounting for Income TaxesChapter 19-5Corporations must tax returns following the guidelines developed by the Internal Revenue Service(IRS),thus they:LO 1 Identify differences between pretax financial income and taxable income.Fundame

10、ntals of Accounting for Income TaxesFundamentals of Accounting for Income Taxescalculate taxes payable based upon IRS code,calculate income tax expense based upon GAAP.Amount reported as tax expense will often differ from the amount of taxes payable to the IRS.Chapter 19-6Tax CodeExchangesInvestors

11、and CreditorsFinancial StatementsPretax Financial IncomeGAAPIncome Tax ExpenseTaxable IncomeIncome Tax PayableTax Returnvs.Fundamentals of Accounting for Income TaxesFundamentals of Accounting for Income TaxesLO 1 Identify differences between pretax financial income and taxable income.Illustration 1

12、9-1Chapter 19-7Illustration:KRC,Inc.reported revenues of$130,000 and expenses of$60,000 in each of its first three years of operations.For tax purposes,KRC reported the same expenses to the IRS in each of the years.KRC reported taxable revenues of$100,000 in 2010,$150,000 in 2011,and$140,000 in 2012

13、.What is the effect on the accounts of reporting different amounts of revenue for GAAP versus tax?LO 1 Identify differences between pretax financial income and taxable income.Fundamentals of Accounting for Income TaxesFundamentals of Accounting for Income TaxesChapter 19-8RevenuesExpensesPretax fina

14、ncial incomeIncome tax expense(40%)$130,00060,000$70,000$28,000$130,000201160,000$70,000$28,000$130,000201260,000$70,000$28,000$390,000Total180,000$210,000$84,000GAAP ReportingGAAP ReportingRevenuesExpensesPretax financial incomeIncome tax payable(40%)$100,000201060,000$40,000$16,000$150,000201160,0

15、00$90,000$36,000$140,000201260,000$80,000$32,000$390,000Total180,000$210,000$84,000Tax Reporting2010LO 1 Identify differences between pretax financial income and taxable income.Book vs.Tax DifferenceIllustration 19-2Illustration 19-3Chapter 19-9Income tax expense(GAAP)Income tax payable(IRS)Differen

16、ce$28,00016,000$12,000$28,000201136,000$(8,000)$28,000201232,000$(4,000)$84,000Total84,000$0ComparisonComparison2010Are the differences accounted for in the financial statements?YearReporting Requirement201020112012Deferred tax liability account increased to$12,000Deferred tax liability account redu

17、ced by$8,000Deferred tax liability account reduced by$4,000YesYesLO 1 Identify differences between pretax financial income and taxable income.Book vs.Tax DifferenceIllustration 19-4Chapter 19-10Balance SheetAssets:Liabilities:Equity:Income tax expense Income tax expense 28,00028,000Income StatementR

18、evenues:Expenses:Net income(loss)20102010Deferred taxes Deferred taxes 12,00012,000Where does the“deferred tax liability”get reported in the financial statements?Income tax payableIncome tax payable16,00016,000LO 1 Identify differences between pretax financial income and taxable income.Financial Rep

19、orting for 2010Chapter 19-11A A Temporary DifferenceTemporary Difference is the difference between the tax basis of an is the difference between the tax basis of an asset or liability and its reported(carrying or book)amount in the financial asset or liability and its reported(carrying or book)amoun

20、t in the financial statements that will result in statements that will result in taxable taxable amounts or amounts or deductibledeductible amounts in amounts in future years.future years.Future Taxable AmountsFuture Taxable AmountsFuture Deductible AmountsFuture Deductible AmountsDeferred Tax Liabi

21、lityDeferred Tax Liability represents the represents the increase in taxes payable in future increase in taxes payable in future years as a result of taxable years as a result of taxable temporary differences existing at temporary differences existing at the end of the current year.the end of the cu

22、rrent year.Deferred Tax AssetDeferred Tax Asset represents the represents the increase in taxes refundable(or saved)in increase in taxes refundable(or saved)in future years as a result of deductible future years as a result of deductible temporary differences existing at the end temporary difference

23、s existing at the end of the current year.of the current year.Illustration 19-22Illustration 19-22 Examples of Temporary DifferencesExamples of Temporary DifferencesLO 2 Describe a temporary difference that results in future taxable amounts.Temporary DifferencesChapter 19-12LO 2 Describe a temporary

24、 difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration:In KRCs situation,the only difference between the book basis and tax basis of the assets and liabilities relates to accounts receivable that arose from re

25、venue recognized for book purposes.KRC reports accounts receivable at$30,000 in the December 31,2010,GAAP-basis balance sheet.However,the receivables have a zero tax basis.Illustration 19-5Chapter 19-13LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts

26、 and Deferred TaxesFuture Taxable Amounts and Deferred TaxesKRC assumes that it will collect the accounts receivable and report the$30,000 collection as taxable revenues in future tax returns.KRC does this by recording a deferred tax liability.Illustration 19-6Illustration:Reversal of Temporary Diff

27、erence,KRC Inc.Chapter 19-14LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesA deferred tax liability represents the increase in taxes payable in future years as a result of taxable temporary

28、 differences existing at the end of the current year.Deferred Tax LiabilityIncome tax expense(GAAP)Income tax payable(IRS)Difference$28,00016,000$12,000$28,000201136,000$(8,000)$28,000201232,000$(4,000)$84,000Total84,000$02010Illustration 19-4Chapter 19-15LO 2 Describe a temporary difference that re

29、sults in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration:Because it is the first year of operations for KRC,there is no deferred tax liability at the beginning of the year.KRC computes the income tax expense for 2010 as follows:De

30、ferred Tax LiabilityIllustration 19-9Chapter 19-16LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration:KRC makes the following entry at the end of 2010 to record income taxes.Deferre

31、d Tax LiabilityIncome Tax Expense 28,000Income Tax Payable 16,000Deferred Tax Liability 12,000Chapter 19-17LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration:Computation of Income

32、Tax Expense for 2011.Deferred Tax LiabilityIllustration 19-10Chapter 19-18LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration:KRC makes the following entry at the end of 2011 to rec

33、ord income taxes.Deferred Tax LiabilityIncome Tax Expense 28,000Deferred Tax Liability 8,000Income Tax Payable 36,000Chapter 19-19LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesIllustration

34、:The entry to record income taxes at the end of 2012 reduces the Deferred Tax Liability by$4,000.The Deferred Tax Liability account appears as follows at the end of 2012.Deferred Tax LiabilityIllustration 19-11Chapter 19-20E19-1:E19-1:Starfleet Corporation has one temporary difference at the Starfle

35、et Corporation has one temporary difference at the end of 2010 that will reverse and cause taxable amounts of end of 2010 that will reverse and cause taxable amounts of$55,000 in 2011,$60,000 in 2012,and$75,000 in 2013.$55,000 in 2011,$60,000 in 2012,and$75,000 in 2013.Starfleets pretax financial in

36、come for 2010 is$400,000,and the Starfleets pretax financial income for 2010 is$400,000,and the tax rate is 30%for all years.There are no deferred taxes at the tax rate is 30%for all years.There are no deferred taxes at the beginning of 2010.beginning of 2010.InstructionsInstructionsa)a)Compute taxa

37、ble income and income taxes payable for 2010.Compute taxable income and income taxes payable for 2010.b)b)Prepare the journal entry to record income tax expense,Prepare the journal entry to record income tax expense,deferred income taxes,and income taxes payable for 2010.deferred income taxes,and in

38、come taxes payable for 2010.LO 2 Describe a temporary difference that results in future taxable amounts.Future Taxable Amounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesChapter 19-21LO 2 Describe a temporary difference that results in future taxable amounts.a.a.a.a.Future Taxable Am

39、ounts and Deferred TaxesFuture Taxable Amounts and Deferred TaxesChapter 19-22Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesIllustration:During 2010,Cunningham Inc.estimated its warranty costs related to the sale of microwave ovens to be$500,000,paid evenly

40、over the next two years.For book purposes,in 2010 Cunningham reported warranty expense and a related estimated liability for warranties of$500,000 in its financial statements.For tax purposes,the warranty tax deduction is not allowed until paid.Illustration 19-12LO 3 Describe a temporary difference

41、that results in future deductible amounts.Chapter 19-23When Cunningham pays the warranty liability,it reports an expense(deductible amount)for tax purposes.Cunningham reports this future tax benefit in the December 31,2010,balance sheet as a deferred tax asset.Illustration 19-13Illustration:Reversal

42、 of Temporary Difference,Cunningham Inc.LO 3 Describe a temporary difference that results in future deductible amounts.Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesChapter 19-24A deferred tax asset represents the increase in taxes refundable(or saved)in fut

43、ure years as a result of deductible temporary differences existing at the end of the current year.Deferred Tax AssetLO 3 Describe a temporary difference that results in future deductible amounts.Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesChapter 19-25Illu

44、stration:Hunt Co.accrues a loss and a related liability of$50,000 in 2010 for financial reporting purposes because of pending litigation.Hunt cannot deduct this amount for tax purposes until the period it pays the liability,expected in 2011.Deferred Tax AssetLO 3 Describe a temporary difference that

45、 results in future deductible amounts.Illustration 19-14Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesChapter 19-26Illustration:Assuming that 2010 is Hunts first year of operations,and income tax payable is$100,000,Hunt computes its income tax expense as fol

46、lows.Deferred Tax AssetLO 3 Describe a temporary difference that results in future deductible amounts.Illustration 19-16Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesChapter 19-27Illustration:Hunt makes the following entry at the end of 2010 to record income

47、 taxes.Deferred Tax AssetIncome Tax Expense 80,000Deferred Tax Asset20,000Income Tax Payable 100,000Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesLO 3 Describe a temporary difference that results in future deductible amounts.Chapter 19-28Illustration:Computa

48、tion of Income Tax Expense for 2011.Deferred Tax AssetIllustration 19-17Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesLO 3 Describe a temporary difference that results in future deductible amounts.Chapter 19-29Illustration:Hunt makes the following entry at t

49、he end of 2011 to record income taxes.Deferred Tax AssetIncome Tax Expense 160,000Deferred Tax Asset20,000Income Tax Payable 140,000Future Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesLO 3 Describe a temporary difference that results in future deductible amounts.C

50、hapter 19-30Illustration:The entry to record income taxes at the end of 2011 reduces the Deferred Tax Asset by$20,000.Illustration 19-18Deferred Tax AssetFuture Deductible Amounts and Deferred TaxesFuture Deductible Amounts and Deferred TaxesLO 3 Describe a temporary difference that results in futur