AM RMVA Saved Help Save & Exit Submit Johannesson&Johannesson started their operations December 2021. When Johannesson&Johannesson sells certain pieces of land for development, the company recognizes income for financial reporting purposes ("the accountant's perspective") in the year of the sale. For some pieces of land, Johannesson&Johannesson recognizes income for tax purposes ("the tax man's perspective") when collected. Income recognized for financial reporting purposes in 2021 for pieces of land sold this way was $25 million, which Johannesson&Johannesson will collect over the next three years. The collections are scheduled as follows: 2022 2023 2024 $ 9 million 12 million 4 million $25 million Johannesson&Johannesson's pre-tax accounting income for 2021 was $34 million. The enactec x rate is 40%. Your task: 1. Assum that there are no differences between taxble income and accounting income except for those described above. Please prepare the journal entry to record income taxes in 2021. 2. Next, suppose that there is a new tax law which changes the tax rate from 40% to 35%, beginning in 2023. This new law is enacted in 2022, when Johannesson&Johannesson's pretax accounting income was $28 million. Assume that only past land sales are affected by this tax rate change (le there are no new temporary differences. Only the DTA/DTL related to the land sold in 2021 is affected). Please prepare the journal entries to record Johannesson&Johannesson's income taxes in 2022. 3. If the tax rate had not changed, what would the balance in the deferred tax liability account have been at the end of 2022? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assuming no differences between accounting income and taxable income other than those described above, prepare the journal entry to record income taxes in 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) Save & Exit Submit complete this question by entering your answers in the tabs Delow. Required 1 Required 2 Required 3 Assuming no differences between accounting income and taxable income other than those described above, prepare the journal entry to record income taxes in 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) View transaction list Journal entry worksheet 1 Record 2021 income taxes. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31, 2021 Record entry Clear entry View general journal Help Save & Exit Required 1 Required 2 Submit Required 3 Suppose a new tax law, revising the tax rate from 40% to 35%, beginning in 2023, is enacted in 2022, when pretax accounting Income was $28 million. No 2022 lot sales qualified for the special tax treatment. Prepare the appropriate journal entry to record income taxes 2022. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place (I.e., 5,500,000 should be entered as 5.5).) Show less View transaction list Journal entry worksheet
