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Whispering Winds Tar and Gravel Ltd. operates a road construction business. In its first year of operations, the company won a contract to build a

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Whispering Winds Tar and Gravel Ltd. operates a road construction business. In its first year of operations, the company won a contract to build a road for the municipality of Cochrane West. It is estimated that the project will be completed over a three-year period starting in June 2020. Whispering Winds uses the percentage of completion method of recognizing revenue on its long-term construction contracts. For tax purposes, and in order to postpone the tax on such revenue for as long as possible. Whispering Winds uses the completed-contract method allowed by the CRA. By its first fiscal year end, the accounts related to the contract had the following balances $332,000 103,000 Accounts Receivable Contract Asset/Liability (net of billings to date of $408,000) Revenue from Long-Term Contracts Construction Expenses 511,000 357,000 The accounts related to the equipment that Whispering Winds purchased to construct the road had the following balances at the end of the first fiscal year ended December 31, 2020 for accounting and tax purposes: Equipment Accumulated Depreciation Equipment Undepreciated Capital Cost $1,160,000 174,000 1,046,000 Whispering Winds's tax rate is 25% for 2020 and subsequent years. Income before income tax for the year ended December 31, 2020, was $193,000. Whispering Winds reports under IFRS. Calculate the deferred tax asset or liability balances at December 31, 2020. Deferred tax $ Calculate taxable income and income tax payable for 2020. $ Taxable income Income tax payable $ Prepare the journal entries to record income taxes for 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry"for the account titles and enter for the amounts.) Account Titles and Explanation Debit Credit (To record current tax expense) (To record deferred tax expense) Prepare the income statement for 2020, beginning with the line Income before income tax" Whispering Winds Tar and Gravel Ltd. (Partial) Income Statement $ $ Provide the SFP presentation for any resulting deferred tax balance sheet accounts at December 31, 2020. Whispering Winds Tar and Gravel Ltd. (Partial) Statement of Financial Position $ Provide the balance sheet presentation for any resulting deferred tax balance sheet accounts at December 31, 2020, assuming Whispering Winds follows ASPE. Whispering Winds Tar and Gravel Ltd. (Partial) Balance Sheet $

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