Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Blossom Inc. reported the following pretax income (loss) and related tax rates during the years 2019-2022. 2019 2020 Pretax Income (loss) Tax Rate $43,100 40
Blossom Inc. reported the following pretax income (loss) and related tax rates during the years 2019-2022. 2019 2020 Pretax Income (loss) Tax Rate $43,100 40 % (203,000) 40 % 253,000 20% 82,600 20% 2021 2022 Pretax financial income (loss) and taxable income (loss) were the same for all years since Blossom began business. The tax rates from 2019-2022 were enacted in 2019. Prepare the journal entries for the years 2020-2022 to record income taxes payable (refundable), income tax expense (benefit), and the tax effects of the loss carryforward. Assume that Blossom expects to realize the benefits of any loss carryforward in the year that immediately follows the loss year. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2020 Deferred Tax Asset 40600 Income Tax Expense 40600 2021 Income Tax Expense 50600 Deferred Tax Asset 31980 Income Tax Payable 18629 2022 Income Tax Expense 16520 Income Tax Payable 16520 Prepare the portion of the income statement, starting with Operating loss before income taxes," for 2020. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Blossom Inc. Income Statement (Partial) For the Year Ended December 31, 2020 Operating Loss before Income Taxes ~ $ (203,000) Income Tax Benefit Income Tax Expense - Deferred 40600 i Net Income /(Loss) $ (162400) Prepare the portion of the income statement, starting with Income before income taxes," for 2021. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Blossom Inc. Income Statement (Partial) For the Year Ended December 31, 2021 Income before Income Taxes $ 253,000 Income Tax Expense Current $ -40600 Deferred 50600 91200 Net Income /(Loss) ta 161800
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started