The accounting (not the income tax) records of Mahoney Publications, Inc., provide the income statement for 2012.

Taxable income for 2012 includes these modifications from pretax accounting income:
a. Additional taxable income of $16,000 earned in 2013 but taxed in 2012
b. Additional depreciation expense of $45,000 for MACRS tax depreciation in 2012

The income tax rate is 40%.

Requirements
1. Compute Mahoney€™s taxable income for 2012.
2. Journalize the corporation€™s income taxes for 2012.
3. Prepare the corporation€™s income statement for2012.

Transcribed Image Text:

2012 Iotal reven icaa $900,000 Expenses Cost of goods sold. Operating expenses.. Total expenses before tax. $470,000 ... 730,000 $170,000 Pretax accounting income