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Ivanhoe Inc. reports the following pretax income (loss) for both book and tax purposes. Year 2023 2024 2025 2026 Pretax Income (Loss) $127,000 86,000 (84,000) 127,000 Tax Rate 20% 20% 25% 25% The tax rates listed were all enacted by the beginning of 2023.

Ivanhoe Inc. reports the following pretax income (loss) for both book and tax purposes. Year 2023 2024 2025 2026 Pretax Income (Loss) $127,000 86,000 (84,000) 127,000 Tax Rate 20% 20% 25% 25% The tax rates listed were all enacted by the beginning of 2023.

FINANCIAL ACCOUNTING
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 Inc. reports the following pretax income (loss) for both book and tax purposes. Year 2023 2024 2025 2026 Pretax Income (Loss) $127,000 86,000 (84,000) 127,000 Tax Rate 20% 20% 25% 25% The tax rates listed were all enacted by the beginning of 2023.
Transcribed Image Text:Ivanhoe Inc. reports the following pretax income (loss) for both book and tax purposes. Year 2023 2024 2025 2026 Pretax Income (Loss) $127,000 86,000 (84,000) 127,000 Tax Rate 20% 20% 25% 25% The tax rates listed were all enacted by the beginning of 2023.
(a) Prepare the journal entries for years 2023-2026 to record income tax expense (benefit) and income taxes payable (refundable), and the tax effects of the loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-half of the benefits of the loss carryforward will not be realized. (List all debit entries before credit entries. 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. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Your answer is partially correct. 2023 2024 2025 2025 2026 Income Tax Expense Income Tax Payable Income Tax Expense Income Tax Payable - Income Tax Expense Income Tax Refund Receivable (To record income taxes.) Income Tax Expense Show Transcribed Text Allowance to Reduce Deferred Tax Asset to Expected Re: Income Tax Expense Income Tax Refund Receivable (To record income taxes.) Income Tax Expense Allowance to Reduce Deferred Tax Asset to Expected Rea (To record allowance.) Income Tax Expense Deferred Tax Asset Income Tax Payable (To record income taxes.) Allowance to Reduce Deferred Tax Asset to Expected Reali Income Tax Expense (To adjust allowance.) eTextbook and Medial 3 List of Accounts Show Transcribed Text Debit 25400 17200 10500 10500 10500 10500 31750 10500 Credit 25400 17200 10500 10500 DA UN UO 10500 10500 10500 21250 10500
Transcribed Image Text:(a) Prepare the journal entries for years 2023-2026 to record income tax expense (benefit) and income taxes payable (refundable), and the tax effects of the loss carryforward, assuming that based on the weight of available evidence, it is more likely than not that one-half of the benefits of the loss carryforward will not be realized. (List all debit entries before credit entries. 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. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Your answer is partially correct. 2023 2024 2025 2025 2026 Income Tax Expense Income Tax Payable Income Tax Expense Income Tax Payable - Income Tax Expense Income Tax Refund Receivable (To record income taxes.) Income Tax Expense Show Transcribed Text Allowance to Reduce Deferred Tax Asset to Expected Re: Income Tax Expense Income Tax Refund Receivable (To record income taxes.) Income Tax Expense Allowance to Reduce Deferred Tax Asset to Expected Rea (To record allowance.) Income Tax Expense Deferred Tax Asset Income Tax Payable (To record income taxes.) Allowance to Reduce Deferred Tax Asset to Expected Reali Income Tax Expense (To adjust allowance.) eTextbook and Medial 3 List of Accounts Show Transcribed Text Debit 25400 17200 10500 10500 10500 10500 31750 10500 Credit 25400 17200 10500 10500 DA UN UO 10500 10500 10500 21250 10500
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