At the end of 2019, Culver Company has $182,000 of cumulative temporary differences that will...
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Accounting
At the end of 2019, Culver Company has $182,000 of cumulative temporary differences that will result in reporting the following future taxable amounts.
2020
$60,200
2021
51,500
2022
40,900
2023
29,400
$182,000
Tax rates enacted as of the beginning of 2018 are:
2018 and 2019
40
%
2020 and 2021
30
%
2022 and later
25
%
Culvers taxable income for 2019 is $306,200. Taxable income is expected in all future years. (a) Prepare the journal entry for Culver to record income taxes payable, deferred income taxes, and income tax expense for 2019, assuming that there were no deferred taxes at the end of 2018.
(b) Prepare the journal entry for Culver to record income taxes payable, deferred income taxes, and income tax expense for 2019, assuming that there was a balance of $22,200 in a Deferred Tax Liability account at the end of 2018.
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