Pito Company has been in operation for several years. During those years, the company has been profitable and it expects to continue to be profitable in the foreseeable future. At the beginning of 2019, Pito has a deferred tax asset of $360 pertaining to one future deductible amount. During 2019, Pito earned taxable income of $51,000 which was taxed at a rate of 30% (no change in the tax rate has been enacted for future years). At the end of 2019, the book value of the current liability to which the deferred tax asset relates for financial reporting purposes exceeded the book value for income tax purposes by $6,000.

Required:

1.	Prepare Pitos income tax journal entry at the end of 2019.
2.	Show how the deferred tax asset is reported on Pitos December 31, 2019, balance sheet.

Prepare Pitos income tax journal entry on December 31, 2019.

General Journal InstructionsHow does grading work?

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GENERAL JOURNAL

Score: 24/37

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT
1	Text entry invalid
2
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2. Show how the deferred tax asset is reported on Pitos December 31, 2019, balance sheet.

Balance Sheet Instruction

Score: 0/12

PITO COMPANY

Partial Balance Sheet

December 31, 2019

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