Wicks Corporation began operations on January 1, 2016. At the end of 2016, Wicks reported pretax financial income of $59,600 and taxable income of $62,930, due to two temporary differences. The income tax rate is 30% for 2016 through 2018, but Congress has enacted a tax rate of 35% for 2019 and beyond. To determine its deferred taxes, Wicks prepared the following schedule of expected future taxable and deductible amounts for the two temporary differences:

	2017	2018	2019	2020
Future taxable amounts	$4,600	$3,700	$4,100	$4,000
Future deductible amount			(16,000)

Required:

1.	Prepare Wickss income tax journal entry at the end of 2016. Assume a valuation allowance is not required.
2.	Prepare the lower portion of the 2016 income statement for Wicks.

Prepare Wickss income tax journal entry on December 31, 2016. Assume a valuation allowance is not required. Additional Instruction

PAGE 1

GENERAL JOURNAL

	DATE	ACCOUNT TITLE	POST. REF.	DEBIT	CREDIT
1
2
3
4

Amount Descriptions

Amount Descriptions
Income before income taxes
Net income
Net loss

Income Statement

Prepare the lower portion of the 2016 income statement for Wicks. Additional Instructions

Wicks Corporation

Partial Income Statement

For Year Ended December 31, 2016

1
2
3