Adjustment Needed

ABC Corporation Unadjusted Trial Balance December 31, 2014 Debit Credit Cash $975,232 Short term investments 167,000 Fair value adjustment (Trading) - Accounts receivable 190,300 Allowance for doubtful accounts $- Inventory - Purchases 350,000 Prepaid insurance 24,600 LT (Debt) investments (HTM) 177,824 Land 75,000 Building 150,000 Accumulated depreciation: building 4,000 Equipment 60,000 Accumulated depreciation: equipment 20,000 Patent 37,500 Accounts payable 75,240 Notes payable 235,000 Income taxes payable 63,800 Unearned rent revenue 36,000 Bonds Payable 800,000 Premium on Bonds Payable 61,771 Common stock 86,000 PIC In Excess of Par-Common Stock 13,000 Retained earnings - Treasury stock 49,000 Dividends 41,000 Sales Revenue 1,192,945 Advertising expense 8,400 Wages expense 67,600 Office expense 21,700 Amortization expense - Depreciation expense 24,000 Utilities expense 31,000 Insurance expense 73,800 Income taxes expense 63,800 $2,587,756 $2,587,756 17 Corporate taxes are due in four estimated quarterly payments on April 15, June 15, September 15, and December 15. However, for the purposes of this ABC illustration, we will assume that estimates are not paid, and that the tax is paid in full on the return's March 15, 2015 due date. ABC's income tax rate is 40%. The entire year's income tax expense was estimated at the beginning of 2014 to be $69,600, so January through November income tax expense recognized amounts to $63,800 (11/12 months). Since we are assuming estimates are not made during the year, the balance in Income taxes payable represents tax accrued for January through November. Assume no deferred tax assets or deferred tax liabilities. Based on the income before income taxes figure from the income statement, record December's income tax expense so that the entire year's total tax expense is correct.