Question

Didde Corp. prepared the following reconciliation of income per books with income per tax return for the year ended December 31, 2017: Book income before income taxes $1,500,000 Add temporary difference Construction contract revenue which was reversed in 2018 $160,000 Deduct temporary difference Depreciation expense which will reverse in equal amounts in each of the next four years ($640,000) Taxable income $1,020,000 Didde's effective income tax rate was 34% for 2017. What amount should Didde have reported in its 2017 income statement as the current provision for income taxes

Answer 1

$346,800

Step-by-step explanation:

Calculation for the amount that should have reported in its 2017 income statement as the current provision for income taxes

Using this formula

Amount reported as current provision for income taxes =(Taxable income*Effective income tax rate)

Let plug in the formula

Amount reported as current provision for income taxes) =($1,020,000 × 34%)

Amount reported as current provision for income taxes) = $346,800

Therefore the amount that should have reported in its 2017 income statement as the current provision for income taxes will be $346,800