Deferred tax : Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account). To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

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Answer 1

Question

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

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Exercise 19.8 (Two Temporary Differences, One rate, 3 years). Button Company has the following two temporary differences between its income tax expense and income taxes payable. 2020 2021 2022 Pretax Financial Income $840,000 $910,000 $945,000 Excess Depreciation Expense on tax Return (30,000) (40,000) (10,000) Excess Warranty Expense in Financial Income 20,000 10,000 8,000 Taxable Income $830,000 $880,000 $943,000 The income tax rate is 20% for all years. Instructions: a) Assuming there were no temporary differences prior to 2020, prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020,2021, and 2022. b) Indicate how deferred taxes will be reported on the 2022 balance sheet. Button’s product warranty is for 12 months. Deferred tax asset ( $ 0 + $ 0 + $ 0 )..............................$ 0 Deferred tax liability ( $ 0 + $ 0 + $ 0…

Manji

Answer 2

Question

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

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Answer 3

Question

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

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Answer 4

Question

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

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Answer 5

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

Answer 6

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

Answer 7

Chapter 20, Problem 20.15E

(1)

To determine

Deferred tax:

Deferred Tax is a liability account that shows the reconciliation amount that occurred due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income tax (Income Tax Payable account).

To Journalize: The appropriate journal entry to record B Company income tax expense for the year 2018.

Answer 8

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

Answer 9

(2)

To determine

To Identify: Adjustment needed to revise retained earnings of B Company

Answer 10

Expert Solution & Answer

Answer 11

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Answer 12

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Answer 13

Ch. 20 - Prob. 20.1Q Ch. 20 - There are three basic accounting approaches to...Ch. 20 - Prob. 20.3Q Ch. 20 - Lynch Corporation changes from the...Ch. 20 - Sugarbaker Designs Inc. changed from the FIFO...Ch. 20 - Most changes in accounting principles are recorded...Ch. 20 - Southeast Steel, Inc., changed from the FIFO...Ch. 20 - Prob. 20.8Q Ch. 20 - Its not easy sometimes to distinguish between a...Ch. 20 - For financial reporting, a reporting entity can be...

Solution Summary: The author explains that deferred tax is a liability account that shows the reconciliation amount due to differences between the estimated income tax amount (Income Tax Expense account) and the outstanding amount of income

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To Identify: Adjustment needed to revise retained earnings of B Company

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