Question: In the current year Madison Corporation had 50 000 of taxable
In the current year, Madison Corporation had $50,000 of taxable income at a tax rate of 25%. During the year, Madison began offering warranties on its products and has a warranty liability for financial reporting purposes of $5,000 at the end of the year. Warranty expenses are not deductible until paid for income tax purposes. Prepare the journal entry to record Madison Corporation's income taxes at the end of the year.
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