The DeVille Company reported pretax accounting income on Its income statement as follows: 2021 2022 2023 $375,000 295,000 365,000 405,000 2024 Included in the income of 2021 was an installment sale of property in the amount of $38,000. However, for tax purposes, DeVille reported the income in the year cash was collected. Cash collected on the installment sale was $15,200 in 2022, $19,000 in 2023, and $3,800 in 2024. Included in the 2023 income was $14,000 interest from investments in municipal governmental bonds. The enacted tax rate for 2021 and 2022 was 40%, but during 2022, new tax legislation was passed reducing the tax rate to 25% for the years 2023 and beyond. Required: Prepare the year-end journal entries to record income taxes for the years 2021-2024. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The DeVille Company reported pretax accounting income on its income statement as follows:

- 2021: $375,000
- 2022: $295,000
- 2023: $365,000
- 2024: $405,000

Included in the 2021 income was an installment sale of property amounting to $38,000. For tax purposes, DeVille reported income in the year cash was collected. Cash collected on the installment sale was $15,200 in 2022, $19,000 in 2023, and $3,800 in 2024.

Included in the 2023 income was $14,000 interest from investments in municipal governmental bonds.

The enacted tax rate for 2021 and 2022 was 40%, but during 2022, new tax legislation reduced the rate to 25% for the years 2023 and beyond.

**Required:**

Prepare the year-end journal entries to record income taxes for the years 2021–2024. (Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

The image includes a "Journal entry worksheet" section with navigation arrows, implying the need to input entries for each year, starting with "Record 2021 income taxes."
Transcribed Image Text:The DeVille Company reported pretax accounting income on its income statement as follows: - 2021: $375,000 - 2022: $295,000 - 2023: $365,000 - 2024: $405,000 Included in the 2021 income was an installment sale of property amounting to $38,000. For tax purposes, DeVille reported income in the year cash was collected. Cash collected on the installment sale was $15,200 in 2022, $19,000 in 2023, and $3,800 in 2024. Included in the 2023 income was $14,000 interest from investments in municipal governmental bonds. The enacted tax rate for 2021 and 2022 was 40%, but during 2022, new tax legislation reduced the rate to 25% for the years 2023 and beyond. **Required:** Prepare the year-end journal entries to record income taxes for the years 2021–2024. (Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) The image includes a "Journal entry worksheet" section with navigation arrows, implying the need to input entries for each year, starting with "Record 2021 income taxes."
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