PreZeeDent, Inc., started operations in 2017 and uses IFRS. The financial statements of PreZeeDent reflected the...

 

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PreZeeDent, Inc., started operations in 2017 and uses IFRS. The financial statements of PreZeeDent reflected the following pre-tax amounts: PreZeeDent, Inc. Statement of Income for years ended December 31 Revenues Depreciation expепse Other operating expenses Pre-tax accounting income 2018 $240,000 21,000 180,000 S 39,000 2019 $345,000 43,500 180,000 S121.500 PreZeeDent, Inc. Balance Sheet (partial) as at December 31 Property, Plant and Equipment, cost Accumulated depreciation Property, Plant and Equipment, net 2018 S375,000 37,500 $337,500 2019 $420,000 81,500 S339.000 Uneamed rent revenue $12,000 Additional information: • The tax rates for PreZeeDent was 25% in 2017, 30% in 2018 and 35% in 2019 which were enacted in February cach year. The uncarned rent revenue represents cash received from a tenant that will be moving into the building on February 1, 2019. For tax purposes any cash received for future rent services is taxed when the cash is received. • PreZeeDent claimed capital cost allowance for tax purposes of $16,500 in 2017, $48,000 in 2018 and $50,250 in 2019. • In 2017, PreZeeDent sold off an excess parcel of land for an amount of $150,000, generating a profit of S60,000. The receipt of cash from this sale was 30% down payment with the balance being 40% in 2018 and 30% in 2019. • Revenue in 2018 inchudes dividends received from taxable Canadian corporations of $3,000 and is not taxable. REQUIRED: 1. Prepare all tax related journal entries to record income taxes for 2018. 2. What are the deferred tax amounts to report on the balance sheet for years ended December 31, 2017 and 2018 and how would they be classified? 3. Prepare the income statement beginning with "Income Before Taxes" for 2018. PreZeeDent, Inc., started operations in 2017 and uses IFRS. The financial statements of PreZeeDent reflected the following pre-tax amounts: PreZeeDent, Inc. Statement of Income for years ended December 31 Revenues Depreciation expепse Other operating expenses Pre-tax accounting income 2018 $240,000 21,000 180,000 S 39,000 2019 $345,000 43,500 180,000 S121.500 PreZeeDent, Inc. Balance Sheet (partial) as at December 31 Property, Plant and Equipment, cost Accumulated depreciation Property, Plant and Equipment, net 2018 S375,000 37,500 $337,500 2019 $420,000 81,500 S339.000 Uneamed rent revenue $12,000 Additional information: • The tax rates for PreZeeDent was 25% in 2017, 30% in 2018 and 35% in 2019 which were enacted in February cach year. The uncarned rent revenue represents cash received from a tenant that will be moving into the building on February 1, 2019. For tax purposes any cash received for future rent services is taxed when the cash is received. • PreZeeDent claimed capital cost allowance for tax purposes of $16,500 in 2017, $48,000 in 2018 and $50,250 in 2019. • In 2017, PreZeeDent sold off an excess parcel of land for an amount of $150,000, generating a profit of S60,000. The receipt of cash from this sale was 30% down payment with the balance being 40% in 2018 and 30% in 2019. • Revenue in 2018 inchudes dividends received from taxable Canadian corporations of $3,000 and is not taxable. REQUIRED: 1. Prepare all tax related journal entries to record income taxes for 2018. 2. What are the deferred tax amounts to report on the balance sheet for years ended December 31, 2017 and 2018 and how would they be classified? 3. Prepare the income statement beginning with "Income Before Taxes" for 2018.

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1 Jourpal Entries 1 To record Current tax expense Income tax expense 13 500 Income ... View the full answer