Required information Problem 16-8 (Algo) Multiple differences; taxable income given; two years; balance sheet classification; change in tax rate (LO16-1, 16-2, 16-3, 16-5, 16-6, 16-8] The following information applies to the questions displayed below! Arndt, Inc. reported the following for 2021 and 2022 ($ in millions): Revenues Expenses Pretax accounting income (income statement) Taxable income (tax return) Tax rate: 25 2021 $ 936 792 $ 144 $ 108 2022 $1,028 848 $ 180 $ 214 a. Expenses each year include $54 million from a two-year casualty insurance policy purchased in 2021 for $108 million. The cost is tax deductible in 2021. b. Expenses include $2 million insurance premiums each year for life insurance on key executives, c. Arndt sells one-year subscriptions to a weekly journal. Subscription sales collected and taxable in 2021 and 2022 were $55 million and $71 million, respectively. Subscriptions included in 2021 and 2022 financial reporting revenues were $49 million ($34 million collected in 2020 but not recognized as revenue until 2021) and $55 million, respectively. Hint View this as two temporary differences-one reversing in 2021: one originating in 2021. d. 2021 expenses included a $38 million unrealized loss from reducing investments (classified as trading securities) to fair value. The investments were sold and the loss realized in 2022 e. During 2020. accounting income included an estimated loss of $28 million from having accrued a loss contingency. The loss was paid in 2021, at which time it is tax deductible. 1. At January 1, 2021, Arndt had a deferred tax asset of $4 million and no deferred tax liability lem 16-8 Part 4 Problem 16-8 Part 4 4. Prepare a schedule that reconciles the difference between pretax accounting income and taxable income Using the schedule, prepare the necessary journal entry to record income taxes for 2022 Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions rounded to 1 decimal place le. 5.500,000 should be entered as 5.5).) is in millions) Current Year 2022 1440 Future Taxable Amounts 12023] o Future Deductible Amounts 2023) 0 2.0 0 0 Pretax accounting income Parmentino Life insurance premiums Temporary differences Casualty Insurance (reversing) Subscriptions--2021 Subsonptions 2022 Unrealed loss (reversing) Taxable income income tax return) 54 (540) (34.0) 400 3803 1380 400 383 an MacBook Air so & % 5 3 6 8 9 W E R T Y Required information Required 1 Required 2 0 0 0 Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions rounded to 1 decimal place (.e., 5,500,000 should be entered as 5.5).) Current Futuro Taxable Futuro ($ in millions) Year Amounts Deductible 2022 20231 Amounts (2023) Pretax accounting income 144.0 Permanent difference: Life insurance premiums 2.0 0 Temporary differences: Casualty insurance (roversing) (54.0) 54 Subscriptions--2021 (34.0) Subscriptions--2022 40.0 40.0 % Unrealized loss (reversing) 38.0 38 % Taxable income (income tax return) 136.0 0 40.0 Enacted tax rate (%) 25.0% 25.0% 25.0% Tax payable currently 27.0% Deferred tax liability 14 0 Deferred tax asset 0 19.5 * Required Required 2 > CD RELI SHIM MULUS Required information Required 1 Required 2 Prepare the necessary journal entry to record income taxes for 2022. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in millions rounded to 1 decimal place (... 5,500,000 should be entered as 5.5).) No Transaction General Journal Debit Credit 1 Income tax expense 25.0 % Deferred tax asset 15,5 Income tax payable 27.0 Deferred tax liability 13.5 1 > MacBook Air so & % 5 3 6 8 9 W E R T Y Required information Required 1 Required 2 0 0 0 Prepare a schedule that reconciles the difference between pretax accounting income and taxable income. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in millions rounded to 1 decimal place (.e., 5,500,000 should be entered as 5.5).) Current Futuro Taxable Futuro ($ in millions) Year Amounts Deductible 2022 20231 Amounts (2023) Pretax accounting income 144.0 Permanent difference: Life insurance premiums 2.0 0 Temporary differences: Casualty insurance (roversing) (54.0) 54 Subscriptions--2021 (34.0) Subscriptions--2022 40.0 40.0 % Unrealized loss (reversing) 38.0 38 % Taxable income (income tax return) 136.0 0 40.0 Enacted tax rate (%) 25.0% 25.0% 25.0% Tax payable currently 27.0% Deferred tax liability 14 0 Deferred tax asset 0 19.5 * Required Required 2 > CD RELI SHIM MULUS Required information Required 1 Required 2 Prepare the necessary journal entry to record income taxes for 2022. (If no entry is required for a transaction/event, select "No journal entry required in the first account field. Enter your answers in millions rounded to 1 decimal place (... 5,500,000 should be entered as 5.5).) No Transaction General Journal Debit Credit 1 Income tax expense 25.0 % Deferred tax asset 15,5 Income tax payable 27.0 Deferred tax liability 13.5 1 >