Ivanhoe Company has the following two temporary differences between its income tax expense and income taxes payable. 2020 2021 2022Pretax financial income $811,000 $932,000 $992,000 Excess depreciation expense on tax return (31,500) (39,100) (9,900)Excess warranty expense in financial income 19,900 9,800 8,300 Taxable income $799,400 $902,700 $990,400 The income tax rate for all years is 20%.Prepare the income tax expense section of the income statement for 2022, beginning with the line “Pretax financial income.”

Income tax (IT) is a periodic expense for the firm which firm has to pay to the government based on…

Answered: Ivanhoe Company has the following two…

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 Company has the following two temporary differences between its income tax expense and income taxes payable.

	2020		2021		2022
Pretax financial income	$811,000			$932,000		$992,000
Excess depreciation expense on tax return	(31,500	)		(39,100	)	(9,900	)
Excess warranty expense in financial income	19,900			9,800		8,300
Taxable income	$799,400			$902,700		$990,400

The income tax rate for all years is 20%.

Prepare the income tax expense section of the income statement for 2022, beginning with the line “Pretax financial income.”

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