Calculate income tax receivable. (show working)

      Years                                                    20X5       20X6         20X7             20X8

Accounting income subject to tax         143,000    191,500    287,000       -409,000

Taxable Income:                                    158,000    206,500    307,000       (394000)

Tax Rate:                                                   35%          37%           40%                40%

Income tax payable:                               55300         76405         122800           -157600

Adjustments:

20X5       -2450

20X6       -14385

20X7        -10565

20X8         20400

The entry in 20X8 is:

Dr Income tax receivable $143,505

Dr Deferred income tax liability $20,400

Cr Income tax expense (recovery) $163,905

Answer rating: 100% (QA)

To calculate the income tax receivable we need to consider t... View the full answer