Evergreen companies 2020 reconciliation between pretax GAAP income and taxable income is as follows. Pretax GAAP income of $200,000. Depreciation adjustment of ($40,000). Permanent difference of $1250. Taxable income of $161,250. The company had one temporary difference due to the GAAP basis of equipment exceeding the tax basis of the equipment. Record the income tax journal entry for 2020 assuming an enacted tax rate of 25%. assume that the December 31, 2019 deffered tax liability balance was $5000.

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 3P: Multiple Temporary Differences Wilcox Company has prepared the following reconciliation of its...
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Evergreen companies 2020 reconciliation between pretax GAAP income and taxable income is as follows. Pretax GAAP income of $200,000. Depreciation adjustment of ($40,000). Permanent difference of $1250. Taxable income of $161,250. The company had one temporary difference due to the GAAP basis of equipment exceeding the tax basis of the equipment. Record the income tax journal entry for 2020 assuming an enacted tax rate of 25%. assume that the December 31, 2019 deffered tax liability balance was $5000.

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