Pronghorn Tar and Gravel Ltd operates a road construction business. In its first year of operations, the company obtained a contract to construct a road for the municipality of Cochrane West, and it is estimated that the project will be completed over a three-year period starting in June 2020. Pronghorn uses the percentage-of-completion method of recognizing revenue on its long-term construction contracts. For tax purposes, and in order to postpone the tax on such revenue for as long as possible. Pronghorn uses the completed-contract method allowed by the CRA. For the second year of operations, Pronghorn made progress on the construction of the road for the municipality. The account balances at December 31, 2020 and 2021, for the construction project and the accounting and tax balances of accounts related to the equipment used for construction follow: 2021 2020 Accounts Receivable $107.000 $320,000 Asset/Liability (net of billings to date of $798,000 and $400,000) 128,000 100.000 Revenue from Long-Term Contracts 426,000 500,000 Construction Expenses 420,000 350,000 Equipment 1,100,000 1,100,000 Accumulated Depreciation Equipment 451.000 174.000 Undepreciated Capital Cost 627.000 985.000 Pronghor's tax rate was 25% in 2020 and 2021. The enacted tax rate for 2022 and subsequent years was reduced to 20% on September 15, 2021. Income before income tax for the year ended December 31, 2020, was $195.000 and for December 31, 2021 was $125,000. Pronghorn reports under IFRS. Prepare the journal entry to record the effect of the change in the enacted tax rate. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and entero for the amounts.) Account Titles and Explanation Debit Credit Date September 15, 2021 Calculate any deferred tax balances at December 31, 2021 Deferred tax liability $ e Textbook and Media List of Accounts X Your answer is incorrect. Calculate taxable income and income tax payable for 2021 $ Taxable income Income tax payable $ Prepare the journal entries to record income taxes for 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit Current Tax Expense Income Tax Payable (To record current tax expense) Deferred Tax Expense Deferred Tax Liability (To record deferred tax expense) Pronghorn Tar and Gravel Ltd operates a road construction business. In its first year of operations, the company obtained a contract to construct a road for the municipality of Cochrane West, and it is estimated that the project will be completed over a three-year period starting in June 2020. Pronghorn uses the percentage-of-completion method of recognizing revenue on its long-term construction contracts. For tax purposes, and in order to postpone the tax on such revenue for as long as possible. Pronghorn uses the completed-contract method allowed by the CRA. For the second year of operations, Pronghorn made progress on the construction of the road for the municipality. The account balances at December 31, 2020 and 2021, for the construction project and the accounting and tax balances of accounts related to the equipment used for construction follow: 2021 2020 Accounts Receivable $107.000 $320,000 Asset/Liability (net of billings to date of $798,000 and $400,000) 128,000 100.000 Revenue from Long-Term Contracts 426,000 500,000 Construction Expenses 420,000 350,000 Equipment 1,100,000 1,100,000 Accumulated Depreciation Equipment 451.000 174.000 Undepreciated Capital Cost 627.000 985.000 Pronghor's tax rate was 25% in 2020 and 2021. The enacted tax rate for 2022 and subsequent years was reduced to 20% on September 15, 2021. Income before income tax for the year ended December 31, 2020, was $195.000 and for December 31, 2021 was $125,000. Pronghorn reports under IFRS. Prepare the journal entry to record the effect of the change in the enacted tax rate. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and entero for the amounts.) Account Titles and Explanation Debit Credit Date September 15, 2021 Calculate any deferred tax balances at December 31, 2021 Deferred tax liability $ e Textbook and Media List of Accounts X Your answer is incorrect. Calculate taxable income and income tax payable for 2021 $ Taxable income Income tax payable $ Prepare the journal entries to record income taxes for 2021. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit Current Tax Expense Income Tax Payable (To record current tax expense) Deferred Tax Expense Deferred Tax Liability (To record deferred tax expense)