Shannon Polymers uses straight-line depreciation for financial reporting purposes for equipment costing $600,00 and with an expected useful life of 4 years and no residual value. For tax purposes, the education is 40%, 30%, 20% and 10% in those years. Pretax accounting income the first year the equipment was used was $700,00, which included interest revenue of $15,000 from municipal bonds. Other than the two described, there are no differences between accounting income and taxable income. The enacted tax rate is 35%.

Prepare the journal entry to record income taxes. (if no entry is required for a transaction/event, select "No journal entry required" in the first account field.)