In 2024, Ryan Management collected rent revenue for 2025 tenant occupancy. For financial reporting, the rent is recorded as deferred revenue and then recognized as revenue in the period tenants occupy rental property. For tax reporting, the rent is taxed when collected in 2024. The deferred portion of the rent collected in 2024 was $66.0 million. The tax rate is 25%. Suppose the deferred portion of the rent collected was $44 million at the end of 2025. Taxable income is $280 million. Prepare the appropriate journal entry to record income taxes in 2025. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5). View transaction list Journal entry worksheet 1 Record the income tax expense for 2025. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Income tax expense Deferred tax asset Income tax payable 70.0 Record entry Clear entry View general journal

SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter17: Business Tax Credits And The Alternative Minimum Tax
Section: Chapter Questions
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In 2024, Ryan Management collected rent revenue for 2025 tenant occupancy. For financial reporting, the rent is recorded as deferred
revenue and then recognized as revenue in the period tenants occupy rental property. For tax reporting, the rent is taxed when
collected in 2024. The deferred portion of the rent collected in 2024 was $66.0 million. The tax rate is 25%. Suppose the deferred
portion of the rent collected was $44 million at the end of 2025. Taxable income is $280 million.
Prepare the appropriate journal entry to record income taxes in 2025.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers
in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).
View transaction list
Journal entry worksheet
1
Record the income tax expense for 2025.
Note: Enter debits before credits.
Transaction
General Journal
Debit
Credit
1
Income tax expense
Deferred tax asset
Income tax payable
70.0
Record entry
Clear entry
View general journal
Transcribed Image Text:In 2024, Ryan Management collected rent revenue for 2025 tenant occupancy. For financial reporting, the rent is recorded as deferred revenue and then recognized as revenue in the period tenants occupy rental property. For tax reporting, the rent is taxed when collected in 2024. The deferred portion of the rent collected in 2024 was $66.0 million. The tax rate is 25%. Suppose the deferred portion of the rent collected was $44 million at the end of 2025. Taxable income is $280 million. Prepare the appropriate journal entry to record income taxes in 2025. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5). View transaction list Journal entry worksheet 1 Record the income tax expense for 2025. Note: Enter debits before credits. Transaction General Journal Debit Credit 1 Income tax expense Deferred tax asset Income tax payable 70.0 Record entry Clear entry View general journal
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