During 2020, Marigold Co.’s first year of operations, the company reports pretax financial income at $247,300. Marigold’s enacted tax rate is 45% for 2020 and 20% for all later years. Marigold expects to have taxable income in each of the next 5 years. The effects on future tax returns of temporary differences existing at December 31, 2020, are summarized as follows. Future Years 2021 2022 2023 2024 2025 Total Future taxable (deductible) amounts: Installment sales $33,800 $33,800 $33,800 $101,400 Depreciation 5,800 5,800 5,800 $5,800 $5,800 29,000 Unearned rent (47,000) (47,000) (94,000) Complete the schedule below to compute deferred taxes at December 31, 2020. (Negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Deferred Tax Temporary Difference Future Taxable (Deductible) Amounts Tax Rate (Asset) Liability Installment sales $101,400 % $ $ Depreciation 29,000 % $ $ Unearned rent (94,000) % $ Totals $ $ $ eTextbook and Media List of Accounts Compute taxable income for 2020. Taxable income for 2020 $ eTextbook and Media List of Accounts Prepare the journal entry to record income taxes payable, deferred taxes, and income tax expense for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit

During 2020, Marigold Co.’s first year of operations, the company reports pretax financial income at $247,300. Marigold’s enacted tax rate is 45% for 2020 and 20% for all later years. Marigold expects to have taxable income in each of the next 5 years. The effects on future tax returns of temporary differences existing at December 31, 2020, are summarized as follows. Future Years 2021 2022 2023 2024 2025 Total Future taxable (deductible) amounts: Installment sales $33,800 $33,800 $33,800 $101,400 Depreciation 5,800 5,800 5,800 $5,800 $5,800 29,000 Unearned rent (47,000) (47,000) (94,000) Complete the schedule below to compute deferred taxes at December 31, 2020. (Negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Deferred Tax Temporary Difference Future Taxable (Deductible) Amounts Tax Rate (Asset) Liability Installment sales $101,400 % $ $ Depreciation 29,000 % $ $ Unearned rent (94,000) % $ Totals $ $ $ eTextbook and Media List of Accounts Compute taxable income for 2020. Taxable income for 2020 $ eTextbook and Media List of Accounts Prepare the journal entry to record income taxes payable, deferred taxes, and income tax expense for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 9MC: Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and...

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eTextbook and Media

List of Accounts

Compute taxable income for 2020.

Taxable income for 2020

eTextbook and Media

List of Accounts

Prepare the journal entry to record income taxes payable, deferred taxes, and income tax expense for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation	Debit	Credit

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	Future Years
	2021	2022		2023	2024	2025	Total
Future taxable (deductible) amounts:
Installment sales	$33,800		$33,800		$33,800			$101,400
Depreciation	5,800		5,800		5,800	$5,800	$5,800	29,000
Unearned rent	(47,000)		(47,000)					(94,000)

					Deferred Tax
Temporary Difference	Future Taxable (Deductible) Amounts	Tax Rate		(Asset)		Liability
Installment sales	$101,400		%		$		$
Depreciation	29,000		%		$		$
Unearned rent	(94,000)		%		$
Totals	$				$		$