Question
Alsup Consulting sometimes performs services for which it receives payment at the conclusion of the engagement, up to six months after services commence. Alsup recognizes service revenue for financial reporting purposes when the services are performed. For tax purposes, revenue is reported when fees are collected. Service revenue, collections, and pretax accounting income for 2017–2020 are as follows:
e Connect. > Secur X Connect > Secure https://newconnect mheducation.com/ ow/connect.htmlPisReg-true&returnUrl;=https%3A%2F%2Fconnect.mheducation.com%2Fpaa web%2Findex.html 623%2Fre Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question 2017 2018 2019 282e Service Revenue $661,600 758,880 715,039 769,689 Collections $626,800 760,8a0 685,ea0 729, 83e Income $19e,88e 255,ee 225,eee 285,68e points There are no differences between accounting Income and taxable Income other than the temporary difference described above. The enacted tax rate for each year is 40%. (Hint: You may find it helpful to prepare a schedule that shows the balances in service revenue receivable at December 31, 2017 2020.) Required 1. Prepare the appropriate journal entry to record Alsup's 2018 income taxes. Alsup's 2019 income taxes and Alsup's 2020 income taxes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in thousands. Answer is not complete No Event General Journal Debit Credit Income tax expense Defered tax liability Income tax payable 106,000 Mc Graw Prev 1of 1011 Next > 12:37 PM Type here to search 3/4/2018 3
Explanation / Answer
Date Particular Debit Credit 2018 Income Tax Expenses 1,02,000 Deffered Tax Liability 10,400 Income Tax Payable 1,12,400 2019 Income Tax Expenses 90,000 Defferedd Tax Liability 12,000 Income Tax Payable 78,000 2020 Income Tax Expenses 82,000 Deffered Tax Liability 8,000 Income Tax Payable 90,000
