Cracker Corporation's First-Quarter 20X4, Pretax Income Is $55,000

Essay

Cracker Corporation's first-quarter 20X4, pretax income is $55,000. The company anticipates an annual tax credit of $15,500. Cracker is projecting income for the remaining three quarters of $135,000. For the second quarter of 20X4, Cracker reports $85,000 of pretax income with a projected pre-tax income for the remainder of the year of $165,000. Cracker does not have any permanent differences between taxable income and financial income.
In the second quarter, Cracker suffers an uninsured loss of one of its warehouses. The loss is determined to be unusual in nature and infrequent in occurrence. The amount of the loss is determined to be $140,000.
The current tax schedule is:
Required:
Calculate the first and second quarter interim tax expenses on continuing income and on the non-ordinary item.