Sandhill Company has the following two temporary differences between its income tax expense and income taxes payable. Pretax financial income Excess depreciation expense on tax return Excess warranty expense in financial income Taxable income The income tax rate for all years is 20%. (a) 2025 $864,000 (30,400) 19,400 $853,000 2026 $917,000 (38,500) 10,100 $888,600 2027 $909,000 (9,800) 8,300 $907,500 Assuming there were no temporary differences prior to 2025, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2025, 2026, and 2027. (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 o for the amounts. Record journal entries in the order presented in the problem.)

Sandhill Company has the following two temporary differences between its income tax expense and income taxes payable. Pretax financial income Excess depreciation expense on tax return Excess warranty expense in financial income Taxable income The income tax rate for all years is 20%. (a) 2025 $864,000 (30,400) 19,400 $853,000 2026 $917,000 (38,500) 10,100 $888,600 2027 $909,000 (9,800) 8,300 $907,500 Assuming there were no temporary differences prior to 2025, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2025, 2026, and 2027. (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 o for the amounts. Record journal entries in the order presented in the problem.)

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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In 2020, Sunland Corporation had pretax financial income of $185,000 and taxable income of $117,000. The difference is due to the use of different depreciation methods for tax and accounting purposes. The effective tax rate is 20%.Compute the amount to be reported as income taxes payable at December 31, 2020. Income taxes payable at December 31, 2020 $enter the amount to be reported as income taxes payable at December 31, 2017
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