Exercise 18-4

Riverbed Corporation reports the following amounts in its first three years of operations.

2020 2021 2022.

Taxable income $242,800 $121,700 $125400

Accounting income-161,100141,300132,100

The difference between taxable income and accounting income is due to one reversing difference. The tax rate is 30% for all years and the company expects to continue with profitable operations in the future.

For each year, identify the amount of the reversing difference originating or reversing during that year, and indicate the amount of the temporary difference at the end of the year.

Amount of temporary. Deductible

difference originating Temporary

or reversing during. Difference

during the Year at Year-End

Originating/reversing

1)2020$- . -

OriginatingReversing

2.)2021$.

OriginatingReversing

3.)2022$. -

Indicate the balance in the related deferred tax account at the end of each year and identify it as a deferred tax asset or liability.

12/31/202012/31/202112/31/2022

Deferred tax ( assent/liability)

Date-12/31/2020 $-

Date- 12/31/2021 $

Date- 12/31/2022 $-

Prepare the journal entries at the end of all three years to record current and deferred taxes.(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 0 for the amounts.)

Date. A/c Titles Dr. Cr.

2020 . -

- -

( To record Current tax expense)

. -

- -

( To record deferred tax benefit).

2021 . -

- -

( To record Current tax expense)

. -

- -

( To record deferred tax benefit)

2022 . -

- -

( To record Current tax expense)

. -

- -

( To record deferred tax benefit)