Pocus, Inc., reports warranty expense when related products are sold. For tax purposes, the warraniy costs...
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Pocus, Inc., reports warranty expense when related products are sold. For tax purposes, the warraniy costs are deductible as incurred. At the end of the current year, Pocus has a warranty liability of $165,000 and taxable income of $13,000,000. At the end of the previous year, Pocus reported a deferred tax asset of $73,000 related to the difference in reporting warranty expense, its only temporary difference. The enacted tax rate is 25% each year. Required: Prepare the appropriate journal entry for Pocus to record the income tax provision for the current year (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Vieansaction list Journal entry worksheet Record the income taxes. Pocus, Inc., reports warranty expense when related products are sold. For tax purposes, the warraniy costs are deductible as incurred. At the end of the current year, Pocus has a warranty liability of $165,000 and taxable income of $13,000,000. At the end of the previous year, Pocus reported a deferred tax asset of $73,000 related to the difference in reporting warranty expense, its only temporary difference. The enacted tax rate is 25% each year. Required: Prepare the appropriate journal entry for Pocus to record the income tax provision for the current year (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Vieansaction list Journal entry worksheet Record the income taxes.
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Related Book For
Canadian Income Taxation planning and decision making
ISBN: 9781259094330
17th edition 2014-2015 version
Authors: Joan Kitunen, William Buckwold
Posted Date:
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