AT&T; LTE 3:49 PM 24 % Atrás A#1.xlsx A#1 Part 1 A#1 Part 2 19-3 (LO1.2) One Tem
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AT&T; LTE 3:49 PM 24 % Atrás A#1.xlsx A#1 Part 1 A#1 Part 2 19-3 (LO1.2) One Temporary Difference, Future Taxable Amounts, One Rate, Beginning Deferred Tase Bandung Corporation provided the following concerning its income taxes for 2017 Balance in Deferred Tax Liability account, January 1, 2017 Cumulative temporary difference, December 31, 2017 $92,00000 350,000 To reverse evenly over the next 2 years accounting income for 2017 Pretax Taxable income for 2017 Income tax rate for all years 25,000 405,000 40% (a) Compute income taxes payable for 2017 (b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable 2017 Future Years 2018 2019 Total Future taxable (deductible) amounts Tax rate Deferred tax liability (asset) Debit Credi Prepare the income tax expense section of the income statement for 2017, beginning with the line "Incon before income taxes.Explanation / Answer
Answer a. Taxable Income 405,000 Income Tax rate 40% Income Tax Payable 162,000 Answer b. Future Years Total 2018 2019 Future Taxable (deductible) Amounts 175,000 175,000 350,000 Tax Rate 40% 40% Deferred Tax Liability (assets) 70,000 70,000 140,000 Deferred tax liability at the end of 2017 140,000 Deferred tax liability at the beginning of 2017 92,000 Deferred Tax Expense for 2017 48,000 Current Tax Expense - 2017 162,000 Income Tax Expense - 2017 210,000 Journal Entry Date Particulars Dr. Amt. Cr. Amt. 1 Income Tax Expense Dr. 210,000 $525,000 X 40% To Income Tax Payable 162,000 $405,000 X 40% To Deferred Tax Liability 48,000 $210,000 - $162,000 Answer c. Income before Income Taxes 525,000 Current 162,000 Deferred 48,000 210,000 Net Income 315,000
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