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Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017 & 2018 Snoopy Inc. Has two temporary
Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017 & 2018
Snoopy Inc. Has two temporary differences at the end of 2017. The first difference stems from a 3-year installment sale (revenue), and the second one results from depreciation expense. Snoopy's accountants have developed the following table illustrating these future deductible and taxable amounts (tax-book differences). 2017 2018 2019 Tax | Book Tax Book Tax | Book Installment $110,000 $310,000 $105,000 ------ $95,0000 Sale (revenue) Depreciation $200,000 $100,000 $120,000 $100,000 $72,000 $100,000 Expense Municipal Interest $-0 $23,000 $20,000 $21,000 Income Pretax Income $828,000 $810,000 $795,000 35% 30% 30% Enacted Tax Rates: At the beginning of 2017, no deferred income taxes are on Snoopy's balance sheet. Pretax accounting income for 2017 is $828,000, and taxable income is expected in all future years. Assume that no adjustment for a valuation allowance is requiredStep by Step Solution
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