PaintCo Inc.,a domestic corporation,owns 100% of BrushCo Ltd.,an Irish corporation.Assume that the U.S.corporate tax rate is 35% and the Irish rate is 15%.PaintCo is permanently reinvesting BrushCo's earnings outside the United States under ASC 740-30 (APB 23).The corporations' book income,permanent and temporary book-tax differences,and current tax expense are reported as follows.Provide the GAAP income tax footnote rate reconciliation for PaintCo using both dollar amounts and percentages.
PaintCo's book income is $1,000,000 (the combined book income of both PaintCo and BrushCo).The effective tax rate reconciliation is based on this book income.The dollar amounts in the table represents the (35%)tax expense (benefit)related to each item.The percentage represents the tax expense (benefit)as a percentage of book income.

Question

PaintCo Inc.,a domestic corporation,owns 100% of BrushCo Ltd.,an Irish corporation.Assume that the U.S.corporate tax rate is 35% and the Irish rate is 15%.PaintCo is permanently reinvesting BrushCo's earnings outside the United States under ASC 740-30 (APB 23).The corporations' book income,permanent and temporary book-tax differences,and current tax expense are reported as follows.Provide the GAAP income tax footnote rate reconciliation for PaintCo using both dollar amounts and percentages.
  PaintCo's book income is $1,000,000 (the combined book income of both PaintCo and BrushCo).The effective tax rate reconciliation is based on this book income.The dollar amounts in the table represents the (35%)tax expense (benefit)related to each item.The percentage represents the tax expense (benefit)as a percentage of book income.

Quizplus · Accepted Answer

The Answer of PaintCo Inc.,a domestic corporation,owns 100% of BrushCo Ltd.,an Irish corporation.Assume that the U.S.corporate tax rate is 35% and the Irish rate is 15%.PaintCo is permanently reinvesting BrushCo's earnings outside the United States under ASC 740-30 (APB 23).The corporations' book income,permanent and temporary book-tax differences,and current tax expense are reported as follows.Provide the GAAP income tax footnote rate reconciliation for PaintCo using both dollar amounts and percentages.
  PaintCo's book income is $1,000,000 (the combined book income of both PaintCo and BrushCo).The effective tax rate reconciliation is based on this book income.The dollar amounts in the table represents the (35%)tax expense (benefit)related to each item.The percentage represents the tax expense (benefit)as a percentage of book income.