Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Marigold Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Marigold inc. follows IERS. The tax rates were all

image text in transcribed
image text in transcribed
image text in transcribed
Marigold Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Marigold inc. follows IERS. The tax rates were all enacted by the beginning of 2023 . (a) Your answer is correct. Prepare the journal entries for the years 2023 to 2026 to record income taxes, assuming the tax loss is first carried back and that at the end of each year, the loss carryforward benefits are judged more likely than not to be realized in the future. (Credit account titles are automotically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account tities and enter Ofor the amounts. Record joumal entries in the order presented in the problem. List all debit entries before credit entries. Current Tax Expense Income Tax Payable 30250 (To record benefit from loss carryback) \begin{tabular}{ll} 2025 Deferred Tax Asset & 28820 \\ \hline \end{tabular} Deferred Tax Benefit 28820 (To record deferred tax benefit from loss carryforward) 2026CurrentTaxExpenseIncomeTaxPayable 64240 (To record current tax expense) Deferred TaxAsset (To record deferred tax expense) Prepare the journal entries for 2025 and 2026 assuming that, based on the weight of available evidence in 2025 , it was more likely than not that only 75% of the carryforward benefits will be realized ( 25% not expected to be realized). In 2026, actual income was higher than originally anticipated. A valuation allowance account is not used by the company. (Credit account titles are outomatically indented when the 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. Record joumal entries in the order presented in the problem. List all debit entries before credit entries.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Practical Guide To Commercial And Industrial Energy Auditing

Authors: Mtijan M Kamara

1st Edition

1717257321, 978-1717257321

More Books

Students also viewed these Accounting questions

Question

What is the environment we are trying to create?

Answered: 1 week ago

Question

How can we visually describe our goals?

Answered: 1 week ago