Exercise 19-10 The following facts relate to Waterway Corporation. 1. Deferred tax liability, January 1, 2017, $71,400. 2. Deferred tax asset, January 1, 2017, $23,800. 3. Taxable income for 2017, $124,950. 4. Cumulative temporary difference at December 31, 2017, giving rise to future taxable amounts, $273,700. 5. Cumulative temporary difference at December 31, 2017, giving rise to future deductible amounts, $113,050. 6. Tax rate for all years, 40%. No permanent differences exist. 7. The company is expected to operate profitably in the future. x Your answer is incorrect. Try again. Compute the amount of pretax financial income for 2017. Pretax financial income 49980 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Your answer is partially correct. Try again. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017. (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.) Account Titles and Explanation Debit Credit Income Tax Expense 66640 Deferred Tax Asset Deferred Tax Liability 49980 Income Tax Payable i 38080 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Your answer is partially correct. Try again. Prepare the income tax expense section of the income statement for 2017, beginning with the line "Income before income taxes." (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Waterway Corporation Income Statement (Partial) For the Year Ended December 31, 2017 Income before Income Taxes 124950 Income Tax Expense Current Current 38080 1 T Deferred 16660 54740 T Net Income / (Loss) 70210 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT X Your answer is incorrect. Try again. Compute the effective tax rate for 2017. (Round answer to 0 decimal places, e.g. 25%) The effective tax rate 57% Exercise 19-10 The following facts relate to Waterway Corporation. 1. Deferred tax liability, January 1, 2017, $71,400. 2. Deferred tax asset, January 1, 2017, $23,800. 3. Taxable income for 2017, $124,950. 4. Cumulative temporary difference at December 31, 2017, giving rise to future taxable amounts, $273,700. 5. Cumulative temporary difference at December 31, 2017, giving rise to future deductible amounts, $113,050. 6. Tax rate for all years, 40%. No permanent differences exist. 7. The company is expected to operate profitably in the future. x Your answer is incorrect. Try again. Compute the amount of pretax financial income for 2017. Pretax financial income 49980 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Your answer is partially correct. Try again. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017. (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.) Account Titles and Explanation Debit Credit Income Tax Expense 66640 Deferred Tax Asset Deferred Tax Liability 49980 Income Tax Payable i 38080 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Your answer is partially correct. Try again. Prepare the income tax expense section of the income statement for 2017, beginning with the line "Income before income taxes." (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Waterway Corporation Income Statement (Partial) For the Year Ended December 31, 2017 Income before Income Taxes 124950 Income Tax Expense Current Current 38080 1 T Deferred 16660 54740 T Net Income / (Loss) 70210 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT X Your answer is incorrect. Try again. Compute the effective tax rate for 2017. (Round answer to 0 decimal places, e.g. 25%) The effective tax rate 57%
