Intermediate Accounting (2nd Edition)
2nd Edition
ISBN: 9780134730370
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Textbook Question
Chapter 17, Problem 17.2P
Temporary Differences,
| Year | Income before Tax and Depreciation | Tax Depreciation | GAAP Depreciation |
| 1 | $ 920,000 | $ 840,000 | $ 700,000 |
| 2 | 1,600,000 | 1.344.000 | 700,000 |
| 3 | 1,780,000 | 806.400 | 700,000 |
| 4 | 2,100,000 | 483.840 | 700,000 |
| 5 | 1.750.000 | 483.840 | 700,000 |
| 6 | 1,200,500 | 241.920 | 700,000 |
| Totals | $4,200,000 | $4,200,000 |
Required
- a. Determine the balance of the deferred tax account at the end of each year.
- b. Prepare the journal entries to record the tax provision for each year.
- c. Prepare the
journal entry to record the effect of a 35% income tax rate that is enacted into law effective as of the beginning of Year 4.
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Chapter 17 Solutions
Intermediate Accounting (2nd Edition)
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