As the new accountant for Ivanhoe's Pet Express Inc., a line of pet boutiques, you are developing the financial statement disclosures for the 2023 financial statement note on income taxes. The company uses ASPE, and has selected the taxes payable method. The statutory tax rate is currently 30%. During 2023, net income before tax was $192,400. CCA exceeded depreciation expense by $25,400. The only permanent difference was the non-deductible portion of meals and entertainment costs, which was 50% of $19,800. (a) Your Answer Correct Answer Your answer is correct. Determine the income tax expense to be recorded using the taxes payable method and record the necessary journal entry. (List debit entry before credit entry. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Income tax expense (b) Account Titles and Explanation Income Tax Expense Income Tax Payable $ d Text Effective Tax Rate IVANHOE'S PET EXPRESS INC. Statement of Reconciliation of Actual Tax Rate 53070 djustment for Permanent Differences Statutory Tax Rate Debit Prepare the reconciliation of the actual tax rate to the statutory rate as required for inclusion in the financial statement note on income taxes. (Round answers to 1 decimal place, e.g. 15.2%. Enter negative percentages using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) 53070 % % % Credit % 53070
As the new accountant for Ivanhoe's Pet Express Inc., a line of pet boutiques, you are developing the financial statement disclosures for the 2023 financial statement note on income taxes. The company uses ASPE, and has selected the taxes payable method. The statutory tax rate is currently 30%. During 2023, net income before tax was $192,400. CCA exceeded depreciation expense by $25,400. The only permanent difference was the non-deductible portion of meals and entertainment costs, which was 50% of $19,800. (a) Your Answer Correct Answer Your answer is correct. Determine the income tax expense to be recorded using the taxes payable method and record the necessary journal entry. (List debit entry before credit entry. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Income tax expense (b) Account Titles and Explanation Income Tax Expense Income Tax Payable $ d Text Effective Tax Rate IVANHOE'S PET EXPRESS INC. Statement of Reconciliation of Actual Tax Rate 53070 djustment for Permanent Differences Statutory Tax Rate Debit Prepare the reconciliation of the actual tax rate to the statutory rate as required for inclusion in the financial statement note on income taxes. (Round answers to 1 decimal place, e.g. 15.2%. Enter negative percentages using either a negative sign preceding the number e.g.-45 or parentheses e.g. (45).) 53070 % % % Credit % 53070
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Bb.81.
Transcribed Image Text:As the new accountant for Ivanhoe's Pet Express Inc., a line of pet boutiques, you are developing the financial statement disclosures
for the 2023 financial statement note on income taxes. The company uses ASPE, and has selected the taxes payable method. The
statutory tax rate is currently 30%. During 2023, net income before tax was $192,400. CCA exceeded depreciation expense by
$25,400. The only permanent difference was the non-deductible portion of meals and entertainment costs, which was 50% of
$19,800.
(a)
Your Answer Correct Answer
Your answer is correct.
Determine the income tax expense to be recorded using the taxes payable method and record the necessary journal entry. (List
debit entry before credit entry. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no
entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Income tax expense
(b)
Account Titles and Explanation
Income Tax Expense
Income Tax Payable
$
d Text
Effective Tax Rate
IVANHOE'S PET EXPRESS INC.
Statement of Reconciliation of Actual Tax Rate
Adjustment for Permanent Differences
Statutory Tax Rate
53070
Prepare the reconciliation of the actual tax rate to the statutory rate as required for inclusion in the financial statement note on
income taxes. (Round answers to 1 decimal place, e.g. 15.2%. Enter negative percentages using either a negative sign preceding the
number e.g. -45 or parentheses e.g. (45).)
V
Debit
53070
%
%
%
Credit
%
53070
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