N The Year CMLU DELCI JULI um continuing operations before income taxes lor e journal entries to record income taxes payable and deferred income taxes for 2018 Pomure the income statement for Walsh Services beginning with "Income from continentations before income taxes for the year ended December 31, 2018 2021 Problem 4. Millcroft Inc. computed a pretax financial income of $40,000 for the first year of its nations onded December 31, 2017 Analysis of the tax and book basis of its liabilities disclosed $360,000 in named tre e on the books that had been recognized as taxable income in 2017 when the cash was received The med rent is expected to be recognized on the books in the following uttam 2018 ....... $ 90,000 2019 160,000 2020.. 70,000 40.000 $300.000 The acted tax rates for this year and the next four years are as follows: 2017 40% 2018 36% 2019... 339 2020 30% 2021 32% Instructions (1) Prepare a schedule showing the reversal of the temporary difference and the computation of income taxes payable and deferred tax assets or liabilities as of December 31, 2017. (2) Prepare journal entries to record income taxes payable and deferred income taxes (3) Prepare the income statement for Millcroft beginning with "Income from continuing operations before income taxes" for the year ended December 31, 2017. Problem 5. Radford Appliances computed a pretax financial loss of $60,000 for the first year of its operations ended December 31. 2017. Analysis of the tax and book basis of its liabilities disclosed $80.000 in accrued warranty expenses on the books that had not been deductible from taxable income in 2017, but would be deductible in future years when the warranty expenses were paid. The future warranty payments are expected to occur in the following pattern: 2018 S14,000 2019..... 36,000 2020 18.000 2021 12.000 $80,000 The enacted tax rates for this year and the next four years are as follows: 2017. 40% 2018 35% 2019 32% 2020 30% 2021 30% Instructions (1) Prepare a schedule showing the reversal of the temporary difference and the computation of income taxes payable and deferred tax assets or liabilities as of December 31, 2017 (2) Prepare journal entries to record income taxes payable and deferred income taxes. (3) Prepare the income tax expense section of the income statement for Walsh Services for 2017 K19-2