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Lurgan Corp. purchased machinery for $250,000 on January 2, 2017, its first day of operations. For book purposes, the machinery will be depreciated using the
Lurgan Corp. purchased machinery for $250,000 on January 2, 2017, its first day of operations. For book purposes, the machinery will be depreciated using the straight-line method over five years with no salvage value. Pretax financial income and taxable income for 2017 are as follows: This temporary difference is due to the use of accelerated depreciation for tax purposes. Prepare the journal entry to record income taxes for 2017 (expense, deferral, and liability) assuming that the enacted tax rate over the life of the machinery is 30%
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