Bonita Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes....
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Bonita Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Pretax Income Year (Loss) Tax Rate 2018 $122,000 17 % 2019 111.000 17 % 2020 (218,000 ) 19 % 2021 308.000 19 % The tax rates listed were all enacted by the beginning of 2018. (a) Your answer is correct. Prepare the journal entries for the years 2018-2021 to record income tax expense (benefit) and income taxes payable (refundable) and the tax effects of the loss carryforward, assuming that at the end of 2020 the benefits of the loss carryforward are judged more likely than not to be realized in the future. (Credit account titles are automatically indented when amount is entered. Do not indent manually, If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2018 Income Tax Expense 20740 Income Tax Payable 20740 2019 Income Tax Expense 18870 2020 Deferred Tax Asset 41420 Income Tax Expense 41420 2021 Income Tax Expense 58520 Income Tax Payable 17100 Deferred Tax Asset 41420 eTextbook and Media List of Accounts Attempts: 1 of 3 used (b) Your Answer Correct Answer Your answer is correct. Assuming that at the end of 2020 the benefits of the loss carryforward are judged more likely than not to be realized in the future, prepare the income tax section of the 2020 income statement. beginning with the line "Operating loss before income taxes" (Enter negotive omounts using elther a negative sign preceding the number eg -45 or parentheses eg. (45)) Bonita Inc. Income Statement (Partial) For the Year Ended December 31. 2020 Operating Loss before Income Taxes %24 210000 Income Statement (Partial) For the Year Ended December 31, 2020 -218000 Operating Loss before Income Taxes Income Tax Benefit Deferred 41420 i Net Income/ (Loss) -176580 eTextbook and Media Solution List of Accounts Attempts: 3 of 3 used (c). Your answer is partially correct Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered, Do not indent manually If noentry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2020 Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts) Date Account Titles and Explanation Debit Credit 2020 (To record refund.) Allowance to Reduce Deferred Tax Asset to Expected Rea (To record allowance.) 2021 Income Tax Expense Deferred Tax Asset Income Tax Payable (To record income taxes.) Allowance to Reduce Deferred Tax Asset to Expected Realiz (To adjust allowance.) eTextbook and Media List of Accounts Bonita Inc. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. Pretax Income Year (Loss) Tax Rate 2018 $122,000 17 % 2019 111.000 17 % 2020 (218,000 ) 19 % 2021 308.000 19 % The tax rates listed were all enacted by the beginning of 2018. (a) Your answer is correct. Prepare the journal entries for the years 2018-2021 to record income tax expense (benefit) and income taxes payable (refundable) and the tax effects of the loss carryforward, assuming that at the end of 2020 the benefits of the loss carryforward are judged more likely than not to be realized in the future. (Credit account titles are automatically indented when amount is entered. Do not indent manually, If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2018 Income Tax Expense 20740 Income Tax Payable 20740 2019 Income Tax Expense 18870 2020 Deferred Tax Asset 41420 Income Tax Expense 41420 2021 Income Tax Expense 58520 Income Tax Payable 17100 Deferred Tax Asset 41420 eTextbook and Media List of Accounts Attempts: 1 of 3 used (b) Your Answer Correct Answer Your answer is correct. Assuming that at the end of 2020 the benefits of the loss carryforward are judged more likely than not to be realized in the future, prepare the income tax section of the 2020 income statement. beginning with the line "Operating loss before income taxes" (Enter negotive omounts using elther a negative sign preceding the number eg -45 or parentheses eg. (45)) Bonita Inc. Income Statement (Partial) For the Year Ended December 31. 2020 Operating Loss before Income Taxes %24 210000 Income Statement (Partial) For the Year Ended December 31, 2020 -218000 Operating Loss before Income Taxes Income Tax Benefit Deferred 41420 i Net Income/ (Loss) -176580 eTextbook and Media Solution List of Accounts Attempts: 3 of 3 used (c). Your answer is partially correct Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered, Do not indent manually If noentry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation Debit Credit 2020 Prepare the journal entries for 2020 and 2021, assuming that based on the weight of available evidence, it is more likely than not that one-fourth of the benefits of the loss carryforward will not be realized. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts) Date Account Titles and Explanation Debit Credit 2020 (To record refund.) Allowance to Reduce Deferred Tax Asset to Expected Rea (To record allowance.) 2021 Income Tax Expense Deferred Tax Asset Income Tax Payable (To record income taxes.) Allowance to Reduce Deferred Tax Asset to Expected Realiz (To adjust allowance.) eTextbook and Media List of Accounts
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Related Book For
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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