D E F G (Deferred Tax Asset with and without Valuation Account) Nova Sci, Inc. has a deferred tax asset account with a balance of $255,000 at the end of 2024 due to a single cumulative temporary difference. At the end of 2025 this same temporary difference has decreased to a cumulative amount of $750,000. Taxable income for 2025 is $650,000. The tax rate is 20% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2024. H Instructions (a) Record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming that it is more likely than not that the deferred tax asset will be realized. (b) Assuming that it is more likely than not that one-half of the deferred tax asset will not be realized, prepare the journal entry at the end of 2025 to record the valuation account. (a) (b) NOTES & COMPUTATIONS AREA

D E F G (Deferred Tax Asset with and without Valuation Account) Nova Sci, Inc. has a deferred tax asset account with a balance of $255,000 at the end of 2024 due to a single cumulative temporary difference. At the end of 2025 this same temporary difference has decreased to a cumulative amount of $750,000. Taxable income for 2025 is $650,000. The tax rate is 20% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2024. H Instructions (a) Record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming that it is more likely than not that the deferred tax asset will be realized. (b) Assuming that it is more likely than not that one-half of the deferred tax asset will not be realized, prepare the journal entry at the end of 2025 to record the valuation account. (a) (b) NOTES & COMPUTATIONS AREA

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Ivanhoe Corporation has a deferred tax asset at December 31, 2026 of $210000 due to the recognition of potential tax benefits of an operating loss carryforward. The enacted tax rates are as follows: 30% for 2023-2025; 25% for 2026; and 20% for 2027 and thereafter. Assuming that management expects that only 50% of the related benefits will be realized, a valuation account should be established in the amount of O $36750. O $31500. O $105000. O $42000. of
Sheridan Inc's only temporary difference at the beginning and end of 2024 is caused by a $3.54 million 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 2025 and 2026. The related deferred tax liability at the beginning of the year is $1,062,000. In the third quarter of 2024, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $5,900,000. and taxable income is expected in all future years. (a) Your answer is incorrect. Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability $ eTextbook and Media List of Accounts Save for Later Last saved 15 hours ago Attomu
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Brown Corp has a deferred tax asset account with balance of $80,000 at the end of 2019 due to a single cumulative temporary difference of $350,000. At the end of 2020, this same temporary difference has increased to cumulative amount of $410,000. Taxable income for 2020 is $800,000. The tax rate is 25% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2019. What one of the following is correct about the journal entry to record Brown's 2020 income tax expense? Group of answer choices Dr. Deferred tax asset $15,000 Dr. Deferred tax liability $25,000 Dr. Income tax expense $200,000 Cr. Tax payable $112,000
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Wildhorse Company has the following two temporary differences between its income tax expense and income taxes payable. 2025 2026 2027 Pretax financial income $820,000 $927,000 $912,000 Excess depreciation expense on tax return (28,700) (42,000) (9,700) Excess warranty expense in financial income Taxable income 20,100 10,400 7,800 $811,400 $895,400 $910,100 The income tax rate for all years is 20%. (a) Your answer is partially correct. Assuming there were no temporary differences prior to 2025, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2025, 2026, and 2027. (List all debit entries before credit entries. 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. Record journal entries in the order presented in the problem.)
Trey, Inc. reports a taxable loss of 5210.000 for 2022. Its taxable income for the last two years was as föllows: 2020 2021 $60,000 80,000 Trey expects tavable income in future years and has a tax rate of 30% for all periods affected. The amount that Trey, Inc. reports as a net loss for Inardal reporting purposes in 2022 is: Seet one 74 ST00000 loss 0 S108000 loss OL 147000 loss 04 ST0000 loss O210000 loss
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