Question

Question 13 Your answer is partially correct. Try again. At the end of 2016, Sheridan Company has $182,000 of cumulative temporary differences that will result in reporting the following future taxable amounts. 2017 2018 2019 2020 $60,200 51,500 40,900 29.400 $182,000 Tax rates enacted as of the beginning of 2015 are: 2015 and 2016 2017 and 2018 30% 2019 and later 40% 25 % Sheridan's taxable income for 2016 is $306,200. Taxable income is expected in all future years. (a) Prepare the journal entry for Sheridan to record income taxes payable, deferred income taxes, and income tax expense for 2016, assuming that there were no deferred taxes at the end of 2015 (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 for the amounts.) Account Titles and Explanation Debit Credit Income Tax Expense 182000 182000 Folicy I 2000-2019.hn Wiley & Sons, Inc. All Rights Reserved. A Division of John Wiley & Sons, Inc

Answer 1

	Debit	Credit
Income Tax Expenses	$173,565
Income Tax Payable (306200*40%)		$122,480
Deferred Tax Liability		$51,085

Year	Temporary Difference	Tax rate	Deffered Tax Liability
2017	$60,200	30%	$18,060
2018	$51,500	30%	$15,450
2019	$40,900	25%	$10,225
2020	$29,400	25%	$7,350
	Total		$51,085

	Debit	Credit
Income Tax Expenses	$151,365
Income Tax Payable (306200*40%)		$122,480
Deferred Tax Liability		$28,885

Year	Temporary Difference	Tax rate	Deffered Tax Liability
2017	$60,200	30%	$18,060
2018	$51,500	30%	$15,450
2019	$40,900	25%	$10,225
2020	$29,400	25%	$7,350
Total			$51,085
Less : Bagining Balance of Deferred Tax			$22,200
Deferred Tax Liability			$28,885