Arnold Industries has pretax accounting income of $176 million for the year ended December 31, 2021. The tax rate is 25%. The only difference between accounting income and taxable income relates to an operating lease in which Arnold is the lessee. The inception of the lease was December 28, 2021. An $152 million advance rent payment at the inception of the lease is tax-deductible in 2021 but, for financial reporting purposes, represents prepaid rent expense to be recognized equally over the four-year lease term. Required: 1. Complete the following table given below and prepare the appropriate journal entry to record Arnolds income taxes for 2021. 2. Prepare the appropriate journal entry to record Arnolds income taxes for 2022. Pretax accounting income was $230 million for the year ended December 31, 2022. 3. Assume a new tax law is enacted in 2022 that causes the tax rate to change from 25% to 15% beginning in 2023. Complete the following table given below and prepare the appropriate journal entry to record Arnolds income taxes for 2022.

place (i.e., 5,500,000 should be entered as 5.5).)

	($ in millions)		Tax Rate %		Tax $	Recorded as:
Pretax accounting income	$176.0
Rent costs reversing in:
2022		x		=
2023		x		=
2024		x		=
2025		x		=
Total deferred tax amount					$0.0
Income taxable in current year

journal entry for 2021 income taxes

journal entry for 2022 income taxes

	($ in millions)		Tax Rate %		Tax $	Recorded as:
Temporary Difference - Beginning of Year		x		=	$0.0
Temporary Difference - End of Year		x		=	$0.0
Change in Deferred Tax account
Income taxable in current year		x		=	$0.0

journal entry for 2022 income taxes