Question
Read Industries reported a defferred tax liability of 8.7 million for the year ended December 31, 2017, related to a temporary difference of 29 million.
Read Industries reported a defferred tax liability of 8.7 million for the year ended December 31, 2017, related to a temporary difference of 29 million. The tax rate was 30%. The temporary difference is expected to reverse in 2019 at which time the deferred tax liability will become payable. There are no other temporary differerences. Assume a new tax law is enacted in 2018 that causes the tax rate to change from 30% to 20% beginning 2019. (the rate remains 30% for 2018 taxes. Taxable income in 2018 is 39 million.
Prepare the journal entry to record Read's income tax expense in 2018.
income tax expense ?
deferred tax liability?
Income tax payable ?
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