Hi, I need help with the last part of this question regarding ASPE.
Problem 18-6 The accounting records f Pina Colada Corp., a real estate developer, indicated income before income ta $854,000 for its year ended December 31, 2017, and of $541.000 for the vear ended December 31, 2018. The following data are also available. $12,000 covering the top management team. The company is the named beneficiary. annual life insurance premium 1. Pina Colada Corp. pays 2. The carrying amount of the company's property, plant, and equipment at January 1, 2017 was $1,266,000, and the UCC at that date was s002017 and 2018, respectively. cCA for tax purposes was $193 000 apd t153 F00 for3017 d 301 3. Pina Colada deducted $212,000 as a restructuring charge in determining income for 2016. At December 31, 2016, an accrued liability of $198,000 remained outstanding relative to the restructuring, which was expected to be completed in the next fiscal year. This expense is deductible for tax restructuring of operations took place in 2017 and 2018, with the ability reduced to $69.000 at the end of 2017 and to $0 at the end of 2018. 4. In 2017, property held for development was sold and a profit of $58,000 was recognized in income. Because the sale was made with delayed payment terms, the profit is taxable only as Pina Colada receives payments from the purchaser. A 10 % down payment was received in 2017, with the remaining 90% expected in equal amounts over the following three years 5. Non-taxable dividends of $3,270 in 2017 and of $3,600 in 2018 were received from taxable Canadian corporations. ddition to the income before income tax identified above, Pina Colada reported a before-tax gain on discontinued operations of $19,400 in 6. 2017. 7. A 29% rate of tax has been in effect since 2015. Pina Colada Corp. follows IFRS. Decembe a negative sian areceding the aumber e.a. -45 or narentheses e.a. (45),) ,2016, 2017, and 2018. (Enter negative amounts using either 2016 2017 2018 Liability - 76415 PP&E -78590 -85550 Liability Liability No balance Restructuring Charges Asset 57,420 Asset 20,010 Profit on Property Sale No balance : Liability Liability -15,138 -10,092 Determine 2017 and 2018 taxable income and current tax expense. (Do not leave any answer field blank. Enter 0 for amounts.) 2017 2018 Continuing Operations: 529300 657530 Taxable income 190683.7 Current income tax expense 153497 Discontinued operations: Taxable income 19400 Current income tax expense 5626 Prepare the journal entries to record current and deferred tax expense for 2017 and 2018. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is reaquired, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Date Debit Credit December 31, 2017 Current Tax Expense 190684 T Current Tax Expense - Discontinued Operations 5626 Income Tax Payable 196310 (To record current taxes.) December 31, 2017 Deferred Tax Expense 59508 Deferred Tax Liability 59508 (To record deferred taxes.) Date Account Titles and Explanation Debit Credit December 31, 2018 Current Tax Expense 153497 Income Tax Payable 153497 (To record current taxes.) December 31, 2018 Deferred Tax Expense 5829 Deferred Tax Liability 5829 (To record deferred taxes.) Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2017 and 2018 balance sheets. Pina Colada Co (Partial) Balance Sheet 2017 Non-Current Liabilities 80678 Deferred Tax Liability Pina Colada Corp. (Partial) Balance Sheet 2018 Non-Current Liabilities 86507 Deferred Tax Liability Prepare partial income statements for the years ended December 31, 2017 and 2018, beginning with the line "Income from continuing operations before income tax." (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Pina Colada Corp. (Partial) Income Statements For the Year Ended December 31, 2017 854000 Income from Continuing Operations Before Income Tax Income Tax - Current 190683.7 Income Tax- Deferred 59508 250192 603808 Income from Continuing Operations Discontinued Operations 19400 Gain on Disposal of Operations Applicable Income Tax Less 5626 13774 Net Income / (Loss) 617582 Pina Colada Corp. (Partial) Income Statements For the Year Ended December 31, 2018 541,000 Income Before Income Tax 153497 Income Tax Expense Current Income Tax Expense Deferred 5829 159326 381674 Net Income / (Loss) Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2017 and 2018 balance sheets if Pina Colada Corp. reported under ASPE Pina Colada Corp. (Patial) Balance Sheets For the Year Ended December 31, 2017 Current Assets 4,872 Future Tax Asset Non-Current Liabilities 85,550 Future Tax Liability Pina Colada Corp. (Patial) Balance Sheets For the Year Ended December 31, 2018 Current Liabilities 10,092 Future Tax Liability Non-Current Liabilities Future Tax Liability 76,451 Problem 18-6 The accounting records f Pina Colada Corp., a real estate developer, indicated income before income ta $854,000 for its year ended December 31, 2017, and of $541.000 for the vear ended December 31, 2018. The following data are also available. $12,000 covering the top management team. The company is the named beneficiary. annual life insurance premium 1. Pina Colada Corp. pays 2. The carrying amount of the company's property, plant, and equipment at January 1, 2017 was $1,266,000, and the UCC at that date was s002017 and 2018, respectively. cCA for tax purposes was $193 000 apd t153 F00 for3017 d 301 3. Pina Colada deducted $212,000 as a restructuring charge in determining income for 2016. At December 31, 2016, an accrued liability of $198,000 remained outstanding relative to the restructuring, which was expected to be completed in the next fiscal year. This expense is deductible for tax restructuring of operations took place in 2017 and 2018, with the ability reduced to $69.000 at the end of 2017 and to $0 at the end of 2018. 4. In 2017, property held for development was sold and a profit of $58,000 was recognized in income. Because the sale was made with delayed payment terms, the profit is taxable only as Pina Colada receives payments from the purchaser. A 10 % down payment was received in 2017, with the remaining 90% expected in equal amounts over the following three years 5. Non-taxable dividends of $3,270 in 2017 and of $3,600 in 2018 were received from taxable Canadian corporations. ddition to the income before income tax identified above, Pina Colada reported a before-tax gain on discontinued operations of $19,400 in 6. 2017. 7. A 29% rate of tax has been in effect since 2015. Pina Colada Corp. follows IFRS. Decembe a negative sian areceding the aumber e.a. -45 or narentheses e.a. (45),) ,2016, 2017, and 2018. (Enter negative amounts using either 2016 2017 2018 Liability - 76415 PP&E -78590 -85550 Liability Liability No balance Restructuring Charges Asset 57,420 Asset 20,010 Profit on Property Sale No balance : Liability Liability -15,138 -10,092 Determine 2017 and 2018 taxable income and current tax expense. (Do not leave any answer field blank. Enter 0 for amounts.) 2017 2018 Continuing Operations: 529300 657530 Taxable income 190683.7 Current income tax expense 153497 Discontinued operations: Taxable income 19400 Current income tax expense 5626 Prepare the journal entries to record current and deferred tax expense for 2017 and 2018. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is reaquired, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Date Debit Credit December 31, 2017 Current Tax Expense 190684 T Current Tax Expense - Discontinued Operations 5626 Income Tax Payable 196310 (To record current taxes.) December 31, 2017 Deferred Tax Expense 59508 Deferred Tax Liability 59508 (To record deferred taxes.) Date Account Titles and Explanation Debit Credit December 31, 2018 Current Tax Expense 153497 Income Tax Payable 153497 (To record current taxes.) December 31, 2018 Deferred Tax Expense 5829 Deferred Tax Liability 5829 (To record deferred taxes.) Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2017 and 2018 balance sheets. Pina Colada Co (Partial) Balance Sheet 2017 Non-Current Liabilities 80678 Deferred Tax Liability Pina Colada Corp. (Partial) Balance Sheet 2018 Non-Current Liabilities 86507 Deferred Tax Liability Prepare partial income statements for the years ended December 31, 2017 and 2018, beginning with the line "Income from continuing operations before income tax." (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Pina Colada Corp. (Partial) Income Statements For the Year Ended December 31, 2017 854000 Income from Continuing Operations Before Income Tax Income Tax - Current 190683.7 Income Tax- Deferred 59508 250192 603808 Income from Continuing Operations Discontinued Operations 19400 Gain on Disposal of Operations Applicable Income Tax Less 5626 13774 Net Income / (Loss) 617582 Pina Colada Corp. (Partial) Income Statements For the Year Ended December 31, 2018 541,000 Income Before Income Tax 153497 Income Tax Expense Current Income Tax Expense Deferred 5829 159326 381674 Net Income / (Loss) Identify how the Deferred Tax Asset or Deferred Tax Liability account(s) will be reported on the December 31, 2017 and 2018 balance sheets if Pina Colada Corp. reported under ASPE Pina Colada Corp. (Patial) Balance Sheets For the Year Ended December 31, 2017 Current Assets 4,872 Future Tax Asset Non-Current Liabilities 85,550 Future Tax Liability Pina Colada Corp. (Patial) Balance Sheets For the Year Ended December 31, 2018 Current Liabilities 10,092 Future Tax Liability Non-Current Liabilities Future Tax Liability 76,451
