Please assist with the following; Calculating and Reporting Income Tax Expense Lynch...
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Please assist with the following;
Calculating and Reporting Income Tax Expense Lynch Company began operations in 2016. The company reported $24,000 of depreciation expense on its income statement in 2016 and $26,000 in 2017. On its tax returns, Lynch deducted $32,000 for depreciation in 2016 and $37,000 in 2017. The 2017 tax return shows a tax obligation (liability) of $19,200 based on a 40% tax rate. Required a. Determine the temporary difference between the book value of depreciable assets and the tax basis of these assets at the end of 2016 and 2017. 2016 6,000x 201717,000X b. Calculate the deferred tax liability for each year. 2016 6,000x 2017 7000X C. Calculate the income tax expense for 2017. $ 0 d. Prepare a journal entry to record income tax expense and post the entry to the appropriate T-accounts for 2017
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