Taxable income and pretax financial income would be identical for Coronado Co. except for its treatments of gross profit on installment sales and estimated costs of warranties. The following income computations have been prepared. Taxable income 2019 2020 2021 Excess of revenues over expenses (excluding two temporary differences) $151,000 $207,000 $96,200 Installment gross profit collected 7,300 7,300 7,300 Expenditures for warranties (5,200 ) (5,200 ) (5,200 ) Taxable income $153,100 $209,100 $98,300 Pretax financial income 2019 2020 2021 Excess of revenues over expenses (excluding two temporary differences) $151,000 $207,000 $96,200 Installment gross profit recognized 21,900 -0- -0- Estimated cost of warranties (15,600 ) -0- -0- Income before taxes $157,300 $207,000 $96,200 The tax rates in effect are 2019, 40%; 2020 and 2021, 45%. All tax rates were enacted into law on January 1, 2019. No deferred income taxes existed at the beginning of 2019. Taxable income is expected in all future years. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019, 2020, and 2021. (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.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020Dec. 31, 2021Dec. 31, 2019 Dec. 31, 2020Dec. 31, 2019Dec. 31, 2021 Dec. 31, 2019Dec. 31, 2020Dec. 31, 2021

Taxable income and pretax financial income would be identical for Coronado Co. except for its treatments of gross profit on installment sales and estimated costs of warranties. The following income computations have been prepared. Taxable income 2019 2020 2021 Excess of revenues over expenses (excluding two temporary differences) $151,000 $207,000 $96,200 Installment gross profit collected 7,300 7,300 7,300 Expenditures for warranties (5,200 ) (5,200 ) (5,200 ) Taxable income $153,100 $209,100 $98,300 Pretax financial income 2019 2020 2021 Excess of revenues over expenses (excluding two temporary differences) $151,000 $207,000 $96,200 Installment gross profit recognized 21,900 -0- -0- Estimated cost of warranties (15,600 ) -0- -0- Income before taxes $157,300 $207,000 $96,200 The tax rates in effect are 2019, 40%; 2020 and 2021, 45%. All tax rates were enacted into law on January 1, 2019. No deferred income taxes existed at the beginning of 2019. Taxable income is expected in all future years. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019, 2020, and 2021. (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.) Date Account Titles and Explanation Debit Credit Dec. 31, 2020Dec. 31, 2021Dec. 31, 2019 Dec. 31, 2020Dec. 31, 2019Dec. 31, 2021 Dec. 31, 2019Dec. 31, 2020Dec. 31, 2021

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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Taxable income	2019		2020		2021
Excess of revenues over expenses (excluding two temporary differences)	$151,000		$207,000		$96,200
Installment gross profit collected	7,300		7,300		7,300
Expenditures for warranties	(5,200	)	(5,200	)	(5,200	)
Taxable income	$153,100		$209,100		$98,300

Pretax financial income	2019		2020		2021
Excess of revenues over expenses (excluding two temporary differences)	$151,000		$207,000		$96,200
Installment gross profit recognized	21,900		-0-		-0-
Estimated cost of warranties	(15,600	)	-0-		-0-
Income before taxes	$157,300		$207,000		$96,200

The tax rates in effect are 2019, 40%; 2020 and 2021, 45%. All tax rates were enacted into law on January 1, 2019. No deferred income taxes existed at the beginning of 2019. Taxable income is expected in all future years.

Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019, 2020, and 2021. (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.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31, 2020Dec. 31, 2021Dec. 31, 2019

Dec. 31, 2020Dec. 31, 2019Dec. 31, 2021

Dec. 31, 2019Dec. 31, 2020Dec. 31, 2021

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