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For the year ended December 31, 2018, Fidelity Engineering reported pretax accounting inccome of $985,000. Selected information for 2018 from Fidelity's records follows: Interest income on municipal bonds Depreciation claimed on the 2018 tax return in excess of depreciation on the income statement Carrying amount of depreciable assets in excess of their tax basis at year-end Warranty expense reported on the income statement Actual warranty expenditures in 2018 $33,600 57,400 89,000 27,200 16,800 Fidelity's income tax rate is 40%. At January 1, 2018, Fidelity's records indicated balances of zero and $12,640 in its deferred tax asset and deferred tax liability accounts, respectively Determine the amounts necessary to record income taxes for 2018. (Enter your answers in thousands rounded to two decimal places (i.e. 1,230 should be entered as 1.23). Amounts to be deducted should be indicated with a minus sign.) Recorded as: Tax Rate % Tax $ Pretax accounting income 985.00 Permanent difference Interest on municipal bonds (ncome tax expense Income subject to taxation 985,00 Temporary difference Depreciation Deferred tax liability Warranty expense Deferred tax asset Income tax payable $ Taxable income (income tax return) 985,00 X - Prepare the appropriate journal entry. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round intermediate calculations to two decimal places. Enter your answers in thousands rounded to two decimal places (i.e. 1,230 should be entered as 1.23).) View transaction list View journal entry worksheet No Event General Journal Debit Credit 1 Income tax expense Deferred tax asset Deferred tax liability Income tax payable What is Fidelity's 2018 net income? (Enter your answer in thousands and round your answer to 2 decimal places. Round intermediate calculations to two decimal places.) Net income Allmond Corporation, orqanized on January 3, 2018, had pretax accounting income of $27 million and taxable income of $34 million for the year ended December 31, 2018. The 2018 tax rate is 35%. The only difference between accounting income and taxable income is estimated product warranty costs. Expected payments and scheduled tax rates (based on recent tax legislation) are as follows: 2019 $3 million 30% 1 million 2020 30% 2021 1 million 303 25 2022 2 million Determine the amounts necessary to record Allmond's income taxes for 2018. (Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5). Enter all amounts as positive values.) Tax $ ($ in millions) Tax Rate % Recorded as: $ Pretax accounting income 27.0 Warranty costs reversing in: 2019 2020 2021 2022 x Total deferred tax amount 0.0 Deferred tax asset Income tax payable Income taxable in current year 27.0 Prepare the appropriate journal entry. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) View transaction list Journal entry worksheet 1 Record 2018 income taxes. Note: Enter debits before credits General Journal Event Debit Credit (ncome tax expense Deferred tax asset Income tax payable What is Allmond's 2018 net income? (Enter your answer in millions rounded to 1 decimal place (i.e, 5,500,000 should be entered as 5.5).) Net income million
