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You are the new accounting manager at the Barry Transport Company, Your CFO has asked you to provide input on the company's income tax position

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You are the new accounting manager at the Barry Transport Company, Your CFO has asked you to provide input on the company's income tax position based on the following 1. Pretax accounting income was $62 million and taxable income was $10 million for the year ended December 31, 2021 2 The difference was due to three items a. Tax depreciation exceeds book depreciation by $50 million in 2021 for the business complex acquired that year. This amount is scheduled to be $80 million in 2022 and to reverse as (580 million) and ($50 million) in 2023 and 2024 respectively b. Insurance of $10 million was paid in 2021 for 2022 coverage. c. A $8 million loss contingency was accrued in 2021, to be paid in 2023 3. No temporary differences existed at the beginning of 2021 4. The tax rate is 25 es Required: 1. Determine the amounts necessary to record income taxes for 2021, and prepare the appropriate journal entry 2. Assume the enacted federal income tax law specifies that the tax rate will change from 25% to 20% in 2023. When scheduling the reversal of the depreciation difference, you were uncertain as to how to deal with the fact that the difference will continue to originate in 2022 before reversing the next two years. Upon consulting PricewaterhouseCoopers' Compeno database, you found 441 Depreciable and amortizable assers Only the reversals of the temporary difference at the balance sheet date would be scheduled Future originations are not considered in determining the reversal pattern of temporary differences for depreciable assets FAS 109 [FASE ASC 740-Income Taxes) is silent to how the balance sheet date temporary differences are deemed to reverse, but the FIFO pattern is intended Determine the amounts necessary to record income taxes for 2021 and prepare the appropriate journal entry Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the amounts necessary to record income taxes for 2021, and prepare the appropriate journal entry. (If no entry is required for a transaction/event, select "No Journal entry required" in the first account field. Enter your answers in millions rounded to 1 decimal place ..., 5,500,000 should be entered as 5.5)) View transaction list Journal entry worksheet Record 2021 Income taxes. Notel Enter debts before credits General Journal Debit Credit Event 1

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