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%. A) Assuming there were no temporary differences prior to 2020, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020, 2021, and 2022. (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.) b)Indicate how deferred taxes will be reported on the 2022 balance sheet. Ivanhoe’s product warranty is for 12 months. Ivanhoe Company Balance Sheet (Partial)
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%. A) Assuming there were no temporary differences prior to 2020, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020, 2021, and 2022. (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.) b)Indicate how deferred taxes will be reported on the 2022 balance sheet. Ivanhoe’s product warranty is for 12 months. Ivanhoe Company Balance Sheet (Partial)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
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 |
(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%.
A) Assuming there were no temporary differences prior to 2020, prepare the
b)Indicate how
|
Ivanhoe Company
Balance Sheet (Partial) |
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