Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Current Attempt in Progress At the beginning of 2025, Skysong Construction Company changed from the cost-recovery method to recognizing revenue over time (percentage-of-completion) for financial
Current Attempt in Progress At the beginning of 2025, Skysong Construction Company changed from the cost-recovery method to recognizing revenue over time (percentage-of-completion) for financial reporting purposes. The company will continue to use the cost-recovery method for tax purposes. For years prior to 2025, pretax income under the two methods was as follows: percentage-of-completion $122,000, and cost-recovery $73,200. The tax rate is 20%. Prepare Skysong's 2025 journal entry to record the change in accounting principle. (Credit account titles are automatically Indented when the 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. List all deblt entries before credit entries.) Account Titles and Explanation Construction in Process Deferred Tax Liability Retained Earnings Debit Credit
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