Carla Corporation reports pretax financial income of $262,600 for 2020. The following items cause taxable income to be different than pretax financial income. 1. Rental income on the income statement is less than rent callected on the tax return by $62,300. 2. Depreciation on the tax return is greater than depreciation on the income statement by $43,200. 3. Interest on an investment in a municipal bond of $5,900 on the income statement. Carla' tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2020. (a) Your answer has been saved. See score details after the due date. Compute taxable income and income taxes payable for 2020. Taxable income 275,800 Income taxes payable 82,740 Attempts: 1 of 1 used (b) Your answer has been saved. See score details after the due date. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manuallx If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit Income Tax Expense 77,010 Deferred Tax Asset 18,690 Income Tax Payable 82,740 Deferred Tax Llability 12,960
Carla Corporation reports pretax financial income of $262,600 for 2020. The following items cause taxable income to be different than pretax financial income. 1. Rental income on the income statement is less than rent callected on the tax return by $62,300. 2. Depreciation on the tax return is greater than depreciation on the income statement by $43,200. 3. Interest on an investment in a municipal bond of $5,900 on the income statement. Carla' tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes at the beginning of 2020. (a) Your answer has been saved. See score details after the due date. Compute taxable income and income taxes payable for 2020. Taxable income 275,800 Income taxes payable 82,740 Attempts: 1 of 1 used (b) Your answer has been saved. See score details after the due date. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manuallx If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit Income Tax Expense 77,010 Deferred Tax Asset 18,690 Income Tax Payable 82,740 Deferred Tax Llability 12,960
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter3: Taxes On The Financial Statements
Section: Chapter Questions
Problem 14P
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Question
Transcribed Image Text:Prepare the income tax expense section of the income statement for 2020, beginning with the line "Income before income
taxes" (Enter negative amounts using either a negative sign preceding the number eg. -45 or parentheses eg. (45)
Carla Company
Income Statement (Partial)
2$
%24
>
>
Transcribed Image Text:Carla Corporation reports pretax financial income of $262,600 for 2020. The following items cause taxable income to be different
than pretax financial income.
1.
Rental income on the income statement is less than rent collected on the tax return by $62,300.
2.
Depreciation on the tax return is greater than depreciation on the income statement by $43,200.
3.
Interest on an investment in a municipal bond of $5,900 on the income statement.
Carla' tax rate is 30% for all years, and the company expects to report taxable income in all future years. There are no deferred taxes
at the beginning of 2020.
(a)
Your answer has been saved. See score details after the due date.
Compute taxable income and income taxes payable for 2020.
Taxable income
275,800
Income taxes payable
B2,740
Attempts: 1 of 1 used
(b)
Your answer has been saved. See score details after the due date
Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2020. (Credit
account titles are automatically indented when amount is entered. Do not indent manualle If no entry is required, select "No Entry" for
the account titles and enter O for the amounts)
Account Titles and Explanation
Debit
Credit
Income Tax Expense
77,010
Deferred Tax Asset
18,690
Income Tax Payable
82.740
Deferred Tax Llability
12,960
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