Refer to E18-12 for Sayaka Tar and Gravel Ltd., and assume the same facts for the fiscal
Question:
Sayaka€™s tax rate continues to be 45% for 2012 and subsequent years. Income before income tax for the year ended December 31, 2012, was $120,000.
Instructions
(a) Calculate the future income tax asset or liability balances at December 31, 2012.
(b) Calculate taxable income and income taxes payable for 2012.
(c) Prepare the journal entries to record income taxes for 2012.
(d) Prepare a comparative income statement for 2011 and 2012, beginning with the line €œIncome before income taxes.€
(e) Provide the comparative balance sheet presentation for any resulting future tax balance sheet accounts at December 31, 2011 and 2012. Be specific about the classification.
(f) Repeat the balance sheet presentation in part (e) assuming Sayaka follows IFRS.
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Step by Step Answer:
Intermediate Accounting
ISBN: 978-0470161012
9th Canadian Edition, Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.