Question
Alsup Consulting sometimes performs services for which it receives payment at the conclusion of the engagement, up to six months after services commence. Alsup recognizes
Alsup Consulting sometimes performs services for which it receives payment at the conclusion of the engagement, up to six months after services commence. Alsup recognizes service revenue for financial reporting purposes when the services are performed. For tax purposes, revenue is reported when fees are collected. Service revenue, collections, and pretax accounting income for 20202023 are as follows: Service Revenue Collections Pretax Accounting Income 2020 $ 688,000 $ 648,000 $ 214,000 2021 778,000 806,000 288,000 2022 738,000 730,000 256,000 2023 744,000 748,000 228,000 There are no differences between accounting income and taxable income other than the temporary difference described above. The enacted tax rate for each year is 25%. (Hint: You will find it helpful to prepare a schedule that shows the balances in service revenue receivable at December 31, 20202023.) Required: 1. to 3. Prepare the appropriate journal entries to record Alsup's 2021 income taxes, 2022 income taxes and 2023 income taxes. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in whole dollars.)
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