Refer to case facts in A17-8.

Data From A17-8

Benata Ltd. started operations in 20X5 and purchased buildings and equipment with an original cost of $400,000. Benata reported the following information:

Required:
Prepare the journal entries for income taxes for each of the four years. Assume the company uses the taxes payable method and that it is concerned it might have another significant loss in 20X9.

Transcribed Image Text:

Accounting earnings before tax Golf club dues Depreciation expense CCA claimed Warranty expense Warranty costs incurred Tax rate-enacted in each year 20X5 $150,000 15,000 45,000 55,000 25,000 22,000 35% 20X6 $230,000 15,000 45,000 92,500 41,000 32,000 37% 20X7 $310,000 20,000 45,000 70,000 57,000 55,000 40% 20X8 $(460,000) 15,000 45,000 - 29,000 23,000 40%