Required: 1. to 3. Prepare the appropriate journal entries to record Alsup's 2024 income taxes, 2025 income taxes, and 2026 income taxes. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.

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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Alsup Consulting sometimes performs services for which it receives
payment at the conclusion of the engagement, up to six months after
services commence. Alsup recognizes service revenue for financial
reporting purposes when the services are performed. For tax purposes,
revenue is reported when fees are collected. Service revenue, collections,
and pretax accounting income for 2023-2026 are as follows:
Pretax Accounting
Service Revenue
Collections
Income
2023
$ 672,000
632,000
$ 198,000
2024
762,000
790,000
272,000
2025
722,000
714,000
240,000
2026
728,000
732,000
212,000
There are no differences between accounting income and taxable income
other than the temporary difference described above. The enacted tax rate
for each year is 25%.
(Hint: You will find it helpful to prepare a schedule that shows the balances
in service revenue receivable at December 31, 2023–2026.)
Required:
1. to 3. Prepare the appropriate journal entries to record Alsup's 2024
income taxes, 2025 income taxes, and 2026 income taxes.
Note: If no entry is required for a transaction/event, select "No journal
entry required" in the first account field. Enter your answers in whole
dollars.
Transcribed Image Text:Alsup Consulting sometimes performs services for which it receives payment at the conclusion of the engagement, up to six months after services commence. Alsup recognizes service revenue for financial reporting purposes when the services are performed. For tax purposes, revenue is reported when fees are collected. Service revenue, collections, and pretax accounting income for 2023-2026 are as follows: Pretax Accounting Service Revenue Collections Income 2023 $ 672,000 632,000 $ 198,000 2024 762,000 790,000 272,000 2025 722,000 714,000 240,000 2026 728,000 732,000 212,000 There are no differences between accounting income and taxable income other than the temporary difference described above. The enacted tax rate for each year is 25%. (Hint: You will find it helpful to prepare a schedule that shows the balances in service revenue receivable at December 31, 2023–2026.) Required: 1. to 3. Prepare the appropriate journal entries to record Alsup's 2024 income taxes, 2025 income taxes, and 2026 income taxes. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.
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