On December 31, 2017, Toms River Rafting, Inc. (TRR), has a deferred tax asset related to a
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The difference between pre-tax book income and taxable income in 2018 relates to a temporary difference for depreciation of property, plant, and equipment that was purchased in 2018.
At December 31, 2018, the enacted tax rate is 35%. However, the substantively enacted tax rate is 40%, and it is fully expected that legislation to change the tax rate to 40%, effective in 2019, will be completed in a matter of days.
Required:
Prepare the journal entries to record tax expense in 2018 under both U.S. GAAP and IFRS.
GAAP
Generally Accepted Accounting Principles (GAAP) is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC). While the SEC previously stated that it intends to move from U.S. GAAP to the International Financial Reporting Standards (IFRS), the...
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Related Book For
Financial Reporting and Analysis
ISBN: 978-1259722653
7th edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
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