Question
Kraft Company made the following journal entry in late 2025 for rent received on property it leases to Danford Corporation. Cash 150,000 Unearned Rent Revenue
Kraft Company made the following journal entry in late 2025 for rent received on property it leases to Danford Corporation.
Cash 150,000 Unearned Rent Revenue 150,000
The payment represents rent for the years 2026 and 2027, the period covered by the lease. Kraft is a cash basis taxpayer. Kraft has income tax payable of $230,000 at the end of 2025, and its tax rate is 25%.
What amount of income tax expense should Kraft Company report at the end of 2025?
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Financial Accounting Theory
Authors: Craig Deegan
2nd Edition
0077126734, 978-0077126735
