The information that follows pertains to Esther Food Products:
a. At December 31, 2018, temporary differences were associated with the following future taxable (deductible) amounts:
Depreciation.................................$ 60,000
Prepaid expenses..............................17,000
Warranty expenses...........................(12,000)
b. No temporary differences existed at the beginning of 2018.
c. Pretax accounting income was $80,000 and taxable income was $15,000 for the year ended December 31, 2018.
d. The tax rate is 40%.
Required:
Determine the amounts necessary to record income taxes for 2018, and prepare the appropriate journal entry.