Question

ABC LLC. has two temporary differences at the end of 2019. The first difference stems from...

ABC LLC. has two temporary differences at the end of 2019. The first difference stems from installment sales, and the second one results from the accrual of a loss contingency. ABC’s accounting department has developed a schedule of future taxable and deductible amounts related to these temporary differences as follows.

2020

2021

2022

2023

Taxable amounts

$41,800

$52,100

$59,600

$75,200

Deductible amounts

(15,700)

(17,400)

$41,800

$36,400

$42,200

$75,200


As of the beginning of 2019, the enacted tax rate is 34% for 2019 and 2020, and 20% for 2021–2024. At the beginning of 2019, the company had no deferred income taxes on its balance sheet. Taxable income for 2019 is $531,000. Taxable income is expected in all future years.

Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019.

indicate how deferred income taxes would be classified on the balance sheet at the end of 2019.

Homework Answers

Answer #1

Hi

Let me know in case you face any issue:

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
ABC LLC. has two temporary differences at the end of 2019. The first difference stems from...
ABC LLC. has two temporary differences at the end of 2019. The first difference stems from installment sales, and the second one results from the accrual of a loss contingency. ABC’s accounting department has developed a schedule of future taxable and deductible amounts related to these temporary differences as follows. 2020 2021 2022 2023 Taxable amounts $41,800 $52,100 $59,600 $75,200 Deductible amounts (15,700) (17,400) $41,800 $36,400 $42,200 $75,200 As of the beginning of 2019, the enacted tax rate is 34%...
Sunland Inc. has two temporary differences at the end of 2016. The first difference stems from...
Sunland Inc. has two temporary differences at the end of 2016. The first difference stems from installment sales, and the second one results from the accrual of a loss contingency. Sunland’s accounting department has developed a schedule of future taxable and deductible amounts related to these temporary differences as follows. 2017 2018 2019 2020 Taxable amounts $38,300 $51,000 $58,800 $79,300 Deductible amounts (14,200 ) (19,800 ) $38,300 $36,800 $39,000 $79,300 As of the beginning of 2016, the enacted tax rate...
At the end of 2019, Culver Company has $182,000 of cumulative temporary differences that will result...
At the end of 2019, Culver Company has $182,000 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2020 $60,200 2021 51,500 2022 40,900 2023 29,400 $182,000 Tax rates enacted as of the beginning of 2018 are: 2018 and 2019 40 % 2020 and 2021 30 % 2022 and later 25 % Culver’s taxable income for 2019 is $306,200. Taxable income is expected in all future years. (a) Prepare the journal entry for Culver to...
Conlin Corp. has one temporary difference at the end of 2019 that will reverse and cause...
Conlin Corp. has one temporary difference at the end of 2019 that will reverse and cause taxable amounts as follows: 2020: 40000 2021: 47800 2022: 36100 Stark’s pretax financial income for 2019 is 5,392,000, tax 81% for all years.There are no differed taxes at the beginning of 2019. Instructions 1 Compute taxable income and income tax payable for 2019. 2 Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019. 3 Prepare...
Problem 19-06 Presented below are two independent situations related to future taxable and deductible amounts resulting...
Problem 19-06 Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary differences existing at December 31, 2020. 1. Carla Co. has developed the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 2025 Taxable amounts $200 $200 $200 $200 $200 Deductible amount — — — (1,900 ) 2. Sarasota Co. has the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 Taxable amounts $200 $200 $200 $200...
Shamrock Corporation has one temporary difference at the end of 2020 that will reverse and cause...
Shamrock Corporation has one temporary difference at the end of 2020 that will reverse and cause taxable amounts of $54,300 in 2021, $59,600 in 2022, and $64,900 in 2023. Shamrock’s pretax financial income for 2020 is $327,400, and the tax rate is 30% for all years. There are no deferred taxes at the beginning of 2020. Compute taxable income and income taxes payable for 2020. Taxable income $enter a dollar amount Income taxes payable $ Prepare the journal entry to...
Monty Inc.’s only temporary difference at the beginning and end of 2019 is caused by a...
Monty Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,450,000 deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1,380,000. In the third quarter of 2019, a new tax rate of 20% is enacted...
Whispering Inc.’s only temporary difference at the beginning and end of 2019 is caused by a...
Whispering Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,630,000 deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1,452,000. In the third quarter of 2019, a new tax rate of 20% is enacted...
Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary...
Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary differences existing at December 31, 2020. 1. Sage Co. has developed the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 2025 Taxable amounts $200 $200 $200 $200 $200 Deductible amount — — — (1,500 ) 2. Pronghorn Co. has the following schedule of future taxable and deductible amounts. 2021 2022 2023 2024 Taxable amounts $200 $200 $200 $200 Deductible amount...
At the end of 2016, Flint Company has $181,900 of cumulative temporary differences that will result...
At the end of 2016, Flint Company has $181,900 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2017 $61,000 2018 49,700 2019 41,800 2020 29,400 $181,900 Tax rates enacted as of the beginning of 2015 are: 2015 and 2016 40 % 2017 and 2018 30 % 2019 and later 25 % Flint’s taxable income for 2016 is $315,000. Taxable income is expected in all future years. (a) Prepare the journal entry for Flint to...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT