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Bernard Enterprises breeds racehorses and sells its own line of saddlery. Bernard began operations on January 1,2023 , when the enacted tax rate was 25%.

image text in transcribed Bernard Enterprises breeds racehorses and sells its own line of saddlery. Bernard began operations on January 1,2023 , when the enacted tax rate was 25%. In 2023, Bernard reported pretax accounting income of $38 million and taxable income of $52 million. Warranty costs are the only difference between GAAP pre-tax income and taxable income. Bernard determined it was more likely than not that the company would realize 90% of the deferred tax assets. The enacted tax rate is 33% in 2024, 2025, and 2026. Thereafter, the enacted tax rate is 27%. The expected warranty payments are: A. Prepare the journal entry/entries to record Bernard's 2023 income taxes. B. What would Bernard report on its 12/31/2023 Balance Sheet regarding income taxes

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