E18.1 (LO 1, 2) (One Temporary Difference, Future Taxable Amounts, One Rate, No Beginning Deferred Taxes) Starfleet Corporation has one temporary difference at the end of 2024 that will reverse and cause taxable amounts of $55,000 in 2025, $60,000 in 2026, and $75,000 in 2027. Starfleet’s pretax financial income for 2024 is $400,000, and the tax rate is 30% for all years. There are no other deferred taxes at the beginning of 2024.

Instructions

a. Compute taxable income and income taxes payable for 2024.

b. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2024.

c. Prepare the income tax expense section of the income statement for 2024, beginning with the line

“Income before income taxes.”