The pretax financial income of Metlock Company differs from its taxable income throughout each of 4 years as follows. Year Pretax Financial Income Taxable income Tax Rate 2020 $277,000 $184,000 35 % 2021 291,000 233,000 20 % 2022 336,000 272,000 20 % 2023 402.000 560,000 20 % Pretax financial income for each year includes a nondeductible expense of $32,900 (never deductible for tax purposes). The remainder of the difference between pretax financial income and taxable income in each period is due to one depreciation temporary difference. No deferred income taxes existed at the beginning of 2020. (a) Your answer is correct. Prepare journal entries to record income taxes in all 4 years. Assume that the change in the tax rate to 20% was not enacted until the beginning of 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter for the amounts.) Date Account Titles and Explanation Debit Credit 2020 Income Tax Expense 108465 Income Tax Payable 64400 Deferred Tax Liability 44065 2021 Deferred Tax Liability 18885 Income Tax Expense 18885 - D 1 2021 Deferred Tax Liability 18885 Income Tax Expense 18885 (To record the adjustment for the decrease in the enacted tax rate.) Income Tax Expense 64780 Deferred Tax Liability 18180 Income Tax Payable 46600 (To record income taxes for 2021.) 2022 Income Tax Expense 73780 Income Tax Payable 54400 Deferred Tax Liability 19380 2023 Income Tax Expense 86980 Deferred Tax Liability 25020 11 Income Tax Payable 112000 (b) Prepare the income statement for 2021, beginning with income before income taxes. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Metlock Company Income Statement (Partial) 44 $