R.S. reported pre-tax accounting income in 2017, 2018, and 2019 of $80 million, plus an additional 2018
Question:
R.S. reported pre-tax accounting income in 2017, 2018, and 2019 of $80 million, plus an additional 2018 income of $50 million from installment sales of property. However, the installment sales income is reported on the tax return when collected, in 2018 ($20 million) and 2019 ($30 million). The enacted tax rate is 40% each yr. Prepare the table calculating the annual tax payable for each yr. Prepare the journal entry for each yr.
Current yr Future Taxable amounts Future Taxable Amount (total)
201 2018 2019
Pretax accounting income:
Temporary difference:
Installment income
Taxable income (tax return)
Enacted tax rate:
Tax payable currently:
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas