Additional Deferred Tax Handout James Cor. is in its first year of operations. The company has...

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Additional Deferred Tax Handout James Cor. is in its first year of operations. The company has pretax income of $400,000. The company has the following items recorded in its records for 2019. Premiums on life insurance of key officers Interest on municipal bonds Warranty Expense Actual Warranty Repairs Beginning Balance in the Allowance for Doubtful Accounts Bad Debt Expense Ending Balance in the Allowance for Doubtful Accounts Rent received in advance from clients that will be recognized evenly over the next 3 years. The tax rate for the current and future years $10,000 5,300 4,000 3,250 1,400 0 800 24,000 40% James Purchased $100,000 in equipment, it will be depreciated using straight line over 4 years for book purposes and double declining over 4 years for tax purposes. Prepare the deferred tax journal entry for 2019 and show the income statement and balance sheet presentation. Hint on Bad Debt Expense: The Bad Debt Expense will be the expense on the Income Statement, the actual write-offs will be the deduction on the tax return. You will need to analyze changes in the allowance for doubtful accounts to solve for one of these (a t-account will help) Additional Deferred Tax Handout James Cor. is in its first year of operations. The company has pretax income of $400,000. The company has the following items recorded in its records for 2019. Premiums on life insurance of key officers Interest on municipal bonds Warranty Expense Actual Warranty Repairs Beginning Balance in the Allowance for Doubtful Accounts Bad Debt Expense Ending Balance in the Allowance for Doubtful Accounts Rent received in advance from clients that will be recognized evenly over the next 3 years. The tax rate for the current and future years $10,000 5,300 4,000 3,250 1,400 0 800 24,000 40% James Purchased $100,000 in equipment, it will be depreciated using straight line over 4 years for book purposes and double declining over 4 years for tax purposes. Prepare the deferred tax journal entry for 2019 and show the income statement and balance sheet presentation. Hint on Bad Debt Expense: The Bad Debt Expense will be the expense on the Income Statement, the actual write-offs will be the deduction on the tax return. You will need to analyze changes in the allowance for doubtful accounts to solve for one of these (a t-account will help)

Answer rating: 100% (QA)

To prepare the deferred tax journal entry for 2019 we need to analyze each item and determine its tax treatment Heres the breakdown 1 Premiums on life insurance of key officers This expense is not ded... View the full answer