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Corning-Howell reported taxable income in 2018 of $190 million. At December 31, 2018, the reported amount of some assets and liabilities in the financial statements

Corning-Howell reported taxable income in 2018 of $190 million. At December 31, 2018, the reported amount of some assets and liabilities in the financial statements differed from their tax bases as indicated below:

Carrying Amount Tax Basis
Assets
Current
Net accounts receivable $ 10 million $ 12 million
Prepaid insurance 37 million 0
Prepaid advertising 7 million 0
Noncurrent
Investments at fair value with changes in OCI* 6 million 0
Buildings and equipment (net) 460 million 350 million
Liabilities
Current
Liabilitysubscriptions received 28 million 0
Long-term
Liabilitypostretirement benefits 585 million 0

*Gains and losses taxable when investments are sold. The total deferred tax asset and deferred tax liability amounts at January 1, 2018, were $260 million and $60 million, respectively. The enacted tax rate is 40% each year. Required: 1. Determine the total deferred tax asset and deferred tax liability amounts at December 31, 2018. 2. Determine the increase (decrease) in the deferred tax asset and deferred tax liability accounts at December 31, 2018. 3. Determine the income tax payable currently for the year ended December 31, 2018. 4. Prepare the journal entry to record income taxes for 2018.

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