Sand engaged in operations at the start of 20X1 and reported $550,000 in pre-tax book...
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Sand engaged in operations at the start of 20X1 and reported $550,000 in pre-tax book income for the year. Tax depreciation for Sand exceeded book depreciation by $50,000. The tax rate for 20X1 was 25%, and Congress had enacted a tax rate of 21% for the years after 20X1. The journal entry to record the taxes for Sand Company at December 31, 20X1 would be: Multiple Choice DR Income tax expense 135,500 CR Deferred tax liability 10,500 CR Income tax payable 125,000 DR Income tax expense 125,000 CR Cash 125,000 DR Income tax expense 146,000 CR Deferred tax liability 10,500 CR income tax payable 135,500 DR Income tax expense 135,500 CR Cash 135,500
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