The pretax financial income of Truttman Company differs from its taxable income throughout each of 4 years as follows. Year Pretax Financial Income Taxable Income Tax Rate 2020 $290,000 $180,000 35% 2021 $320,000 $225,000 20% 2022 $350,000 $260,000 20% 2023 $420,000 $560,000 20% Pretax financial income for each year includes a nondeductible expense of $30,000 (never deductible for tax purposes). The remainder of the difference between pretax financial income and taxable income in each period is due to one depreciation temporary difference. No deferred income taxes existed at the beginning of 2020. Instructions a.    Prepare journal entries to record income taxes in all 4 years. Assume that the change in the tax rate to 20% was not enacted until the beginning of 2021. b.    Prepare the income statement for 2021, beginning with Income before income taxes.

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A: (a) The table below shows the each year carryover utilized:

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Q: Wright Co., organized on January 2, 2021, had pretax accounting income of $960,000 and taxable…

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A: Given Information:  Non deductible expense - $29,300 Tax rate for 2021 - 20%

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A: The tax - Related journal entries for 2019 to 2013   Accounting entry for the 2019 year.   Provision…

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A: a. Entries for income taxes for 2016:

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A: SOLUTION-                                                                     INCOME STATEMENT…

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Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.