Vanier Corporation reported the following information at the beginning of its current fiscal year:

Deferred income tax asset (warranties) $ 2,400 (dr)

Deferred income tax liability (depreciable assets) 10,500 (cr)

During the year, Vanier reports the following information:

-Pre-tax income was $850,000 and the tax rate was 32%;

-Depreciation expense was $75,000 and the CCA was $80,000. The carrying amount of property, plant, and equipment at the end of the year was $420,000 while the UCC was $380,000;

-Warranty expense was reported at $40,000 while actual cash paid out was $38,000. The warranty liability had a year-end balance of $10,000.

-No other items affected deferred tax amounts other than these transactions.

Required:

Prepare the journal entries to record income tax for the year. Provide the income statement section commencing with Net income before taxes.

Vanier Corporation reported the following information at the beginning of its current fiscal year:

Deferred income tax asset (warranties) $ 2,400 (dr)

Deferred income tax liability (depreciable assets) 10,500 (cr)

During the year, Vanier reports the following information:

-Pre-tax income was $850,000 and the tax rate was 32%;

-Depreciation expense was $75,000 and the CCA was $80,000. The carrying amount of property, plant, and equipment at the end of the year was $420,000 while the UCC was $380,000;

-Warranty expense was reported at $40,000 while actual cash paid out was $38,000. The warranty liability had a year-end balance of $10,000.

-No other items affected deferred tax amounts other than these transactions.

Required:

Prepare the journal entries to record income tax for the year. Provide the income statement section commencing with Net income before taxes.