Refer to case facts in A17-19.

Data From A17-19

On 1 January 20X7, Chang Inc. commenced business operations. At 31 December 20X9, the following information relates to Chang:

Required:
Prepare the journal entries for income taxes for 20X7, 20X8, and 20X9. Assume the company uses the taxes payable method.

Transcribed Image Text:

Earnings (loss) before tax Tax rate (enacted in each year) Depreciation expense (asset cost was $600,000) Capital cost allowance Dividends received (nontaxable) Golf club dues 20X8 $302,400 ($453,600) 20X7 30% 50,000 180,000 38,400 9,600 35% 50,000 0 60,000 9,600 20X9 $720,000 40% 50,000 78,000 60,000 9,600