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sed to amount of $491,000. Taxable income for 2021 is $845,000. The tax rate is 30% for all years. (a) Record income tax expense, deferred income taxes, and income taxes payable for 2021, assuming that it is p that the deferred tax asset will be realized. (Credit account titles are automatically indented when the amount is not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit

sed to amount of $491,000. Taxable income for 2021 is $845,000. The tax rate is 30% for all years. (a) Record income tax expense, deferred income taxes, and income taxes payable for 2021, assuming that it is p that the deferred tax asset will be realized. (Credit account titles are automatically indented when the amount is not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit

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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The following information has been obtained for Tamarisk Corporation.

 
### Tamarisk Corp. Deferred Tax Asset Accounting #### Background Information: Tamarisk Corp. has a deferred tax asset account with a balance of $116,400 at the end of 2020 due to a single cumulative temporary difference of $388,000. At the end of 2021, this same temporary difference has increased to a cumulative amount of $491,000. For 2021, the taxable income is $845,000. The tax rate is 30% for all years. ### Journal Entry (a): **Requirement:** Record income tax expense, deferred income taxes, and income taxes payable for 2021, assuming that it is probable that the deferred tax asset will be realized. *(Credit account titles are automatically indented when the 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.)* #### Journal Entry Table: | Account Titles and Explanation | Debit | Credit | |-------------------------------------------|--------------|---------------| | | | | | | | | | | | | | | | | This exercise involves calculation and entry of tax-related adjustments based on provided financial data. Students are required to determine the appropriate figures to debit and credit in relation to income tax expense, deferred income taxes, and income taxes payable for the year 2021.
Transcribed Image Text:### Tamarisk Corp. Deferred Tax Asset Accounting #### Background Information: Tamarisk Corp. has a deferred tax asset account with a balance of $116,400 at the end of 2020 due to a single cumulative temporary difference of $388,000. At the end of 2021, this same temporary difference has increased to a cumulative amount of $491,000. For 2021, the taxable income is $845,000. The tax rate is 30% for all years. ### Journal Entry (a): **Requirement:** Record income tax expense, deferred income taxes, and income taxes payable for 2021, assuming that it is probable that the deferred tax asset will be realized. *(Credit account titles are automatically indented when the 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.)* #### Journal Entry Table: | Account Titles and Explanation | Debit | Credit | |-------------------------------------------|--------------|---------------| | | | | | | | | | | | | | | | | This exercise involves calculation and entry of tax-related adjustments based on provided financial data. Students are required to determine the appropriate figures to debit and credit in relation to income tax expense, deferred income taxes, and income taxes payable for the year 2021.
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