Business, 06.05.2020 03:15 portedon8644

Oriole Inc. began business on January 1, 2021. Its pretax financial income for the first 2 years was as follows: 2021 $290,000 2022 610,000 The following items caused the only differences between pretax financial income and taxable income.

1. In 2021, the company collected $375,000 of rent; of this amount, $125,000 was earned in 2021; the other $250,000 will be earned equally over the 2022–2023 period. The full $375,000 was included in taxable income in 2021.
2. The company pays $10,500 a year for life insurance on officers.
3. In 2022, the company terminated a top executive and agreed to $105,000 of severance pay. The amount will be paid $35,000 per year for 2022-2024. The 2022 payment was made. The $105,000 was expensed in 2022. For tax purposes, the severance pay is deductible as it is paid.

The enacted tax rates existing at December 31, 2021 are: 2021 20% 2023 30% 2022 25% 2024 30%

Determine taxable income for 2021 and 2022.

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Oriole Inc. began business on January 1, 2021. Its pretax financial income for the first 2 years was...

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