Dell Technologies Inc. the following information for December 2019-2021
2019 2020 2021
Pretax Accounting Income (2,361) (4) 3,670
Tax Rate for 2019-2021 – 35%

a. Dell paid in advance for Insurance for 3 years beginning 2019, $15,000.
b. Unrealised Gain was recorded in 2020 for investment but it was not sold until 2021, $6,000
c. Dell recorded a bad debt expense of $4,000 in 2021 which the government did not recognize.
d. Interest received in 2020 for $4,500 was from a government bond investment.

Requirements:
1. Identify the permanent vs the temporary differences.
2. Prepare a schedule showing the calculation of the taxable income for both 2019 - and 2021.
3. Prepare journal entries for each year (2019 – 2021)
4. Show how any 2021 tax related amounts should be classified and reported in the 2021 balance sheet.

Answer rating: 100% (QA)

Quiz 1 Permanent Difference Interest received in 2020 for 4500 is from a government bond investment Dell Technologies Inc recorded a bad debt expense ... View the full answer