Journal entry to record income tax provision for year 3 and year 4. Given Information: Cost of acquisition of new machinery is $600,000. Useful life is 6 years. Income tax rate is 40%.

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Answer 1

Question

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

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Answer 2

Question

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

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Answer 3

Question

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

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Answer 4

Question

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

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Answer 5

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

Answer 6

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

Answer 7

Chapter 17, Problem 17.4E

a.

To determine

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

Answer 8

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

Answer 9

b.

To determine

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

Answer 10

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

Answer 11

c.

To determine

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 17 - Prob. 17.1Q Ch. 17 - When will income tax expense and income taxes...Ch. 17 - Will permanent differences cause the effective tax...Ch. 17 - When do permanent differences arise?Ch. 17 - How are deferred tax assets and deferred tax...Ch. 17 - Prob. 17.6Q Ch. 17 - Prob. 17.7Q Ch. 17 - Prob. 17.8Q Ch. 17 - Prob. 17.9Q Ch. 17 - How does a firm determine the need for a valuation...

Journal entry to record income tax provision for year 3 and year 4. Given Information: Cost of acquisition of new machinery is $600,000. Useful life is 6 years. Income tax rate is 40%.

Solution Summary: The author explains journalizing as the process of recording the transaction of an organization in a chronological order.

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To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.

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Chapter 17 Solutions

Journal entry to record income tax provision for year 3 and year 4. Given Information: Cost of acquisition of new machinery is $600,000. Useful life is 6 years. Income tax rate is 40%.

Solution Summary: The author explains journalizing as the process of recording the transaction of an organization in a chronological order.

Videos

To prepare: Journal entry to record income tax provision for year 3 and year 4. Given Information: Cost of acquisition of new machinery is $600,000. Useful life is 6 years. Income tax rate is 40%.

Balance of deferred tax account at the end of year 3. Given Information: MACR rate for year 1 is 20%. MACR rate for year 2 is 32%. MACR rate for year 3 is 19.2%. MACR rate for year 4 is 11.52% MACR rate for year 5 is 11.52% MACR rate for year 6 is 5.76%.

Reported net income for year 3 and year 4. Given information: Income before tax and depreciation for year 1 is $930,000. Income before tax and depreciation for year 2 is 1,100,000. GAAP depreciation is $100,000.

Want to see the full answer?

Chapter 17 Solutions

To prepare: Journal entry to record income tax provision for year 3 and year 4.

Given Information:

Cost of acquisition of new machinery is $600,000.

Useful life is 6 years.

Income tax rate is 40%.

Balance of deferred tax account at the end of year 3.

Given Information:

MACR rate for year 1 is 20%.

MACR rate for year 2 is 32%.

MACR rate for year 3 is 19.2%.

MACR rate for year 4 is 11.52%

MACR rate for year 5 is 11.52%

MACR rate for year 6 is 5.76%.

Reported net income for year 3 and year 4.

Given information:

Income before tax and depreciation for year 1 is $930,000.

Income before tax and depreciation for year 2 is 1,100,000.

GAAP depreciation is $100,000.