Henry Company had Pretax financial income of $850,000 at the end of 2020. Estimat warranty expense of €500,000 will be deductible in 2021, €300,000 in 2022, and €150,000 2023. The use of the depreciable assets will result in taxable amounts of €350,000 in each the next three years. Required (a) - Prepare a table of future taxable and deductible amounts.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Question 11-pen sion
Henry Company had Pretax financial income of $850,000 at the end of 2020. Estimate d
warranty expense of €500,000 will be deductible in 2021, €300,000 in 2022, and€150,000 in
2023. The use of the depreciable assets will result in taxable amounts of €350,000 in each of
the next three years.
Required
(a)
Prepare a table of future taxable and deductible amounts.
(b) - Prepare the journal entry to record income tax expense, deferred income taxes, and
income taxes payable for 2020, assuming an income tax rate of 35% for all years.
Transcribed Image Text:Question 11-pen sion Henry Company had Pretax financial income of $850,000 at the end of 2020. Estimate d warranty expense of €500,000 will be deductible in 2021, €300,000 in 2022, and€150,000 in 2023. The use of the depreciable assets will result in taxable amounts of €350,000 in each of the next three years. Required (a) Prepare a table of future taxable and deductible amounts. (b) - Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020, assuming an income tax rate of 35% for all years.
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