Allmond Corporation, organized on January 3, 2018, had pretax accounting income of $30 million and taxable income of $38 million for the year ended December 31, 2018. The 2018 tax rate is 30%. 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$2 million25%20202 million25%20212 million25%20222 million20%

Required:

1.Determine the amounts necessary to record Allmond's income taxes for 2018 and prepare the appropriate journal entry.

2.What is Allmond's 2018 net income?