Hogan Ltd. started as a manufacturing company on January 1, 2021. On January 1, 2021, Hogan purchased $140,000 of equipment which it is amortizing on a straight-line basis over 7 years for accounting purposes under IFRS. The equipment is subject to a 12% CCA rate for income tax purposes, and is eligible for the Accelerated Investment Initiative (i.e. 1.5 times the CCA rate) in the year of acquisition. In 2021, Hogan reported net income before income taxes of $1,250,000. Included on the company's income statement was meals and entertainment expense of $96,000. At the end of 2022, Hogan reported net income before taxes of $980,000, and meals and entertainment expense of $84,000. The income tax rate for 2021 was 24%. On March 15, 2022, the tax rate for 2022 and later years dropped to 22%. This rate change was not known at the end of 2021. REQUIRED: Prepare the journal entries required to record Hogan Ltd. 's income taxes for 2021 and 2022. Show all your calculations. (9 Marks) 4 5 6 3. Calculation of DIT Asset / Liability resulting from CCA vs Depreciation: Year Base CCA UCC 5 2021 6 2022 7 DIT Asset/Liability Year CCA Depreciation Difference Tax 8 9 8 9 10 2021 2022 11 12 2021: 13 Current income tax calculation: 14 Accounting income 15 Permanent difference(s): 16 17 18 19 Temporary difference(s): 20 21 22 23 Taxable income 24 Current income tax 25 26 Journal entries: 27 (Type debit account name in column B, credit account name in column C) 28 Account Name 29 Debit Credit Debit Credit 26 Journal entries: 27 (Type debit account name in column B, credit account name in column C) 28 Account Name 29 30 31 32 33 34 35 36 37 38 2022: 39 Current income tax calculation: 40 Accounting income 41 Permanent difference(s): 42 43 44 45 Temporary difference(s): 46 47 48 49 Taxable income 50 Current income tax 51 52 Journal entries: 53 (Type debit account name in column B, credit account name in column C) 54 Account Name 55 Debit Credit 56 57