P19-1 (Three Differences, No Beginning Deferred Taxes, Multiple Rates) The following information is available for Remmers Corporation for 2014.
							1. Depreciation reported on the tax return exceeded depreciation reported on the income statement by
$120,000	This difference will reverse in equal amounts of				$30,000	over the years
2015-2018.
2. Interest received on municipal bonds was			$10,000
3. Rent collected in advance on January 1, 2014, totaled				$60,000	for a 3-year period. Of this
amount,	$40,000	was reported as unearned at December 31, 2014, for book purposes.
4. The tax rates are		40%	for 2014 and	35%	for 2015 and subsequent years.
5. Income taxes of		$320,000	are due per the tax return for 2014.
6. No deferred taxes existed at the beginning of 2014.
Instructions:
(a) Compute taxable income for 2014.
	Use this area for calculations
	Use this area for calculations
	Use this area for calculations
	Use this area for calculations
(b) Compute pretax financial income for 2014.
	Taxable income from part (a)			Amount
	Title			Amount
	Title			Amount
	Title			Amount
	Pretax financial income for 2012			Formula
(c) Prepare the journal entries to record income tax expense, deferred income taxes, and income taxes
payable for 2014 and 2015. Assume taxable income was					$980,000	in 2015.
2014	Account Title				Formula
	Account Title				Amount
	Account Title					Amount
	Account Title					Amount
2015	Account Title				Formula
	Account Title				Formula
	Account Title					Formula
	Account Title					Formula
(d) Prepare the income tax expense section of the income statement for 2014, beginning with "Income before income taxes."
	Income before income taxes				Amount
	Income tax expense
	Title			Amount
	Title			Amount	Formula
	Net income				Formula