Carla Inc.’s only temporary difference at the beginning and end of 2016 is caused by a $3,540,000 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 2017 and 2018. The related deferred tax liability at the beginning of the year is $1,416,000. In the third quarter of 2016, a new tax rate of 34% is enacted into law and is scheduled to become effective for 2018. Taxable income for 2016 is $5,900,000, and taxable income is expected in all future years.
Determine the amount reported as a deferred tax liability at the end of 2016.
Prepare the journal entry necessary to adjust the deferred tax liability when the new tax rate is enacted into law. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Draft the income tax expense portion of the income statement for 2016. Begin with the line “Income before income taxes.” Assume no permanent differences exist. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Carla Inc.’s only temporary difference at the beginning and end of 2016 is caused by a...
Skysong Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,540,000 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 $1,416,000. In the third quarter of 2019, a new tax rate of 20% is enacted...
Exercise 19-14 Metlock Inc.'s only temporary difference at the beginning and end of 2019 is caused by a $3,690,000 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 $1,476,000. In the third quarter of 2019, a new tax rate of 20%...
Buffalo Inc.’s only temporary difference at the beginning and
end of 2016 is caused by a $3,300,000 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 2017 and 2018. The related
deferred tax liability at the beginning of the year is $1,320,000.
In the third quarter of 2016, a new tax rate of 34% is enacted...
Sheffield Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,330,000 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 $1,332,000. In the third quarter of 2019, a new tax rate of 20% is enacted...
6:34 @ . @ @ Pronghorn Inc's only temporary difference at the beginning and end of 2019 is caused by a $3,030,000 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 $1,212.000. In the third quarter of 2019, a new...
(Deferred Tax Liability, Change in Tax Rate, Prepare Section of Income Statement) Novotna Inc.’s only temporary difference at the beginning and end of 2016 is caused by a $3 million deferred gain for tax purposes for an install- ment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal install- ments in 2017 and 2018. The related deferred tax liability at the beginning of the year is...
At the end of 2019, Carla Company has $176,400 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2020 $58,000 2021 49,400 2022 40,100 2023 28,900 $176,400 Tax rates enacted as of the beginning of 2018 are: 2018 and 2019 40 % 2020 and 2021 30 % 2022 and later 25 % Carla’s taxable income for 2019 is $306,100. Taxable income is expected in all future years. (a) Prepare the journal entry for Carla to...
At the end of 2016, Pearl Company has $181,100 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2017 $59,800 2018 51,100 2019 39,000 2020 31,200 $181,100 Tax rates enacted as of the beginning of 2015 are: 2015 and 2016 40 % 2017 and 2018 30 % 2019 and later 25 % Pearl’s taxable income for 2016 is $316,200. Taxable income is expected in all future years. (a) Prepare the journal entry for Pearl to...
Exercise 19-11 At the end of 2016, Metlock Company has $182,500 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2017 2018 2019 2020 $59,100 50,200 42,000 31,200 $182,500 Tax rates enacted as of the beginning of 2015 are: 2015 and 2016 2017 and 2018 2019 and later 40 % 30% 25 % Metlock's taxable income for 2016 is $314,700. Taxable income is expected in all future years. (a) Prepare the journal entry for Metlock...
At the end of 2016, Teal Company has $181,100 of cumulative
temporary differences that will result in reporting the following
future taxable amounts.
2017
$59,800
2018
51,100
2019
39,000
2020
31,200
$181,100
Tax rates enacted as of the beginning of 2015 are:
2015 and 2016
40
%
2017 and 2018
30
%
2019 and later
25
%
Teal’s taxable income for 2016 is $316,200. Taxable income is
expected in all future years.
(a) Prepare the journal entry for Teal to...