Colt Company reports pretax financial “income” of $143,000 in 2019. In addition to pretax income from continuing operations (of which revenues are $295,000), the following items are included in this pretax “income:”
Loss from disposal of Division B ............................................(10,000)
Income from operations of discontinued Division B ...........16,000
Prior period adjustment ..........................................................(8,000)
Colt’s taxable income totals $93,000 in 2019. The difference between the pretax financial income and the taxable income is due to the excess of tax depreciation over financial depreciation on assets used in continuing operations. At the beginning of 2019, Colt had a retained earnings balance of $310,000 and a deferred tax liability of $8,100. During 2019, Colt declared and paid dividends of $48,000. It is subject to tax rates of 15% on the first $50,000 of income and 30% on income in excess of $50,000. Based on proper interperiod tax allocation procedures, Colt has determined that its 2019 ending deferred tax liability is $14,100.

Required:
1. Prepare a schedule for Colt to allocate the total 2019 income tax expense to the various components of pretax income.
2. Prepare Colt’s income tax journal entry at the end of 2019.
3. Prepare Colt’s 2019 income statement.
4. Prepare Colt’s 2019 statement of retained earnings.
5. Show the related income tax disclosures on Colt’s December 31, 2019, balance sheet.