Nash Enterprises Ltd., a private company following ASPE earned accounting income before taxes of $1,713,000 for...

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Nash Enterprises Ltd., a private company following ASPE earned accounting income before taxes of $1,713,000 for the year ended December 31, 2020. During 2020, Nash paid $212,000 for meals and entertainment expenses. In 2017, Nash's tax accountant made a mistake when preparing the company's income tax return. In 2020, Nash paid $16,000 in penalties related to this error. These penalties were not deductible for tax purposes. Nash owned a warehouse building for which it had no current use, so the company chose to use the building as a rental property. At the beginning of 2020, Nash rented the building to SPK Inc. for two years at $260,000 per year. SPK paid the entire two years' rent in advance. Nash used the straight-line depreciation method for accounting purposes and recorded depreciation expense of $402,000. For tax purposes, Nash claimed the maximum capital cost allowance of $627,000. Nash began to sell its products with a two-year warranty against manufacturing defects in 2020 to match a warranty introduced by its main competitor. In 2020, Nash accrued $597,000 of warranty expenses: actual expenditures for 2020 were $286,000 with the remaining $311,000 anticipated in 2021. In 2020, Nash was subject to a 35% income tax rate. During the year, the federal government announced that tax rates would be decreased to 33% for all future years beginning January 1, 2021. Prepare the journal entries to record current and future income taxes for 2020. (Credit account titles are automatically indented when the 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.) Account Titles and Explanation Debit Credit (To record current tax expense.) (To record future tax expense.) Nash Enterprises Ltd., a private company following ASPE earned accounting income before taxes of $1,713,000 for the year ended December 31, 2020. During 2020, Nash paid $212,000 for meals and entertainment expenses. In 2017, Nash's tax accountant made a mistake when preparing the company's income tax return. In 2020, Nash paid $16,000 in penalties related to this error. These penalties were not deductible for tax purposes. Nash owned a warehouse building for which it had no current use, so the company chose to use the building as a rental property. At the beginning of 2020, Nash rented the building to SPK Inc. for two years at $260,000 per year. SPK paid the entire two years' rent in advance. Nash used the straight-line depreciation method for accounting purposes and recorded depreciation expense of $402,000. For tax purposes, Nash claimed the maximum capital cost allowance of $627,000. Nash began to sell its products with a two-year warranty against manufacturing defects in 2020 to match a warranty introduced by its main competitor. In 2020, Nash accrued $597,000 of warranty expenses: actual expenditures for 2020 were $286,000 with the remaining $311,000 anticipated in 2021. In 2020, Nash was subject to a 35% income tax rate. During the year, the federal government announced that tax rates would be decreased to 33% for all future years beginning January 1, 2021. Prepare the journal entries to record current and future income taxes for 2020. (Credit account titles are automatically indented when the 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.) Account Titles and Explanation Debit Credit (To record current tax expense.) (To record future tax expense.)

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Journal entry Meal and entertainment exps dr 212000 To Bank 212000 Penalty ac dr 16000 To b... View the full answer