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Exercise 16-22 (Algo) Multiple temporary differences; record income taxes [LO16-2, 16-3] The information that follows pertains...

Exercise 16-22 (Algo) Multiple temporary differences; record income taxes [LO16-2, 16-3]

The information that follows pertains to Richards Refrigeration, Inc.:

  1. At December 31, 2021, temporary differences existed between the financial statement book values and the tax bases of the following:
($ in millions)
Book Value Tax
Basis		 Future Taxable
(Deductible)
Amount
Buildings and equipment (net of accumulated depreciation) $ 128 $ 94 $ 34
Prepaid insurance 54 0 54
Liability—loss contingency 29 0 (29 )
  1. No temporary differences existed at the beginning of 2021.
  2. Pretax accounting income was $204 million and taxable income was $145 million for the year ended December 31, 2021. The tax rate is 25%.

Required:
1. Complete the following table given below and prepare the appropriate journal entry to record income taxes for 2021.
2. What is the 2021 net income?

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