In 2018, DFS Medical Supply collected rent revenue for 2019 tenant occupancy. For income tax reporting, the rentis taxed when collected. For financial statement reporting, the rent is recorded as deferred revenue and then recognized as income in the period tenants occupy the rental property. The deferred portion of the rent collected in 2018amounted to $300,000 at December 31, 2018. DFS had no temporary differences at the beginning of the year.Required:Assuming an income tax rate of 40% and 2018 income tax payable of $950,000, prepare the journal entry to recordincome taxes for 2018.
In 2018, DFS Medical Supply collected rent revenue for 2019 tenant occupancy. For income tax reporting, the rentis taxed when collected. For financial statement reporting, the rent is recorded as deferred revenue and then recognized as income in the period tenants occupy the rental property. The deferred portion of the rent collected in 2018amounted to $300,000 at December 31, 2018. DFS had no temporary differences at the beginning of the year.Required:Assuming an income tax rate of 40% and 2018 income tax payable of $950,000, prepare the journal entry to recordincome taxes for 2018.
Chapter16: Accounting Periods And Methods
Section: Chapter Questions
Problem 33P
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Question
In 2018, DFS Medical Supply collected rent revenue for 2019 tenant occupancy. For income tax reporting, the rent
is taxed when collected. For financial statement reporting, the rent is recorded as deferred revenue and then recognized as income in the period tenants occupy the rental property. The deferred portion of the rent collected in 2018
amounted to $300,000 at December 31, 2018. DFS had no temporary differences at the beginning of the year.
Required:
Assuming an income tax rate of 40% and 2018 income tax payable of $950,000, prepare the
income taxes for 2018.
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