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yearted acounting carnings before taxes as follows: 20X6, 5675,000, 20x7, S57,000 months ending 31 March 20X7. Rent revenue is taxable in the ? A16-8 Tax

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yearted acounting carnings before taxes as follows: 20X6, 5675,000, 20x7, S57,000 months ending 31 March 20X7. Rent revenue is taxable in the ? A16-8 Tax Calculations: follows: me excep Penguin Corp, reported accounting earnings income for each year would have been the same as pre-tax the first time in 20X6, of $7,200 in rent revenue, representing on I October 20X6, for the six tax rate for 20X5 and 20X7 is 25%, and the year-end for both rent revenue collected in advance is the only difference between not repeated in October 20X7 as pre-tax accounting income except tor the tax effects, ar purposes is 31 December, Th accounting earnings and taxable income, and i in rent revenue, representing $1,200 per month rent revenue collected inao 20x2.sthe ony difference between acounting and tax p Required: 1. Is this a temporary difference? Why, or why not? 2. What is the accounting carrying value for the unearned rent at the end of 20X6? The tax basis? Explain. 3. Calculate taxable income and income tax payable, and prepare j entries for each year-end. . Prepare a partial statement of profit and loss for each year, starting with pre-tax accounting earnings 5. What amount of deferred income tax would be reported on the 20X6 and 20X7 statements of financial position? A16-9 Tax Calculations The pre-tax income statements for Moonstone Ltd. for two years (summarized) were as follows: 20x8 $264,000 180,000 S84.000 20x9 $328,000 236,000 $ 92,000 Revenues Expenses Pre-tax income For tax purposes, the following income tax differences existed: a. Revenues on the 20X9 statement of profit and loss include $36,000 rent, which is taxable in 20X8 but was b. Expenses on the 20X9 statement of profit and loss include political contributions of $12,000, which are aot c. Expenses on the 20x8 statement of profit and loss include $20,800 of estimated warranty costs, which are unearned at the end of 20X8 for accounting purposes. deductible for income tax purposes. not deductible for income tax purposes until 20X9. Required: 1. What was the accounting carrying value and tax basis for unearned revenue and the warranty liability a dhe end of 20X8 and 20X9? 2. Compute Assume a tax rate of 30%. Give the entry to record income taxes for each period. (a) income tax payable, (b) deferred income tax, and (C) income tax expense for each 3

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