Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Colombo Company included in 2020 a deferred income on installment sale of P500,000 in accounting income. This deferred income is expected to reverse for tax

Colombo Company included in 2020 a deferred income on installment sale of P500,000 in accounting income.

This deferred income is expected to reverse for tax purposes in 2021.

Accounting income:

2020 - 5,500,000

2021 - 7,000,000

Taxable Income:

2020 - 5,000,000

2021 - 7,500,000

Income tax rate:

2020 - 30%

2021 - 30%

Required:

1. Prepare journal entries to record the income tax and deferred tax for 2020 and 2021.

2. Present the income tax expense in the income statement for 2020 and 2021.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Integrated Accounting

Authors: Dale A. Klooster, Warren Allen, Glenn Owen

8th edition

ISBN: 1285462726, 1285462721, 978-1285462721

More Books

Students also viewed these Accounting questions

Question

5. It is the needs of the individual that are important.

Answered: 1 week ago

Question

3. It is the commitment you show that is the deciding factor.

Answered: 1 week ago