In 2023, Windsor Ltd., which follows IFRS, reported accounting income of $1,130,000 and the 2023 tax rate was 20%. Windsor hadtwo timing differences for tax purposes:CCA on the company's tax return was $512,000. Depreciation expense on the financial statements was $308,000. These amountsrelate to assets that were acquired on January 1, 2023, for $2,048,000.Accrued warranty expense for financial statement purposes was $140,600 (accrued expenses are not deductible for tax purposes).This is the first year Windsor offers warranties.Both of these timing differences are expected to fully reverse over the next four years, as follows:Year2024202520262027DepreciationDifference$70,50057,50040,50035,500WarrantyExpense Rate$20,500 20%29,900 20%39,600 18%50,600 18%$204,000 $140,600 (c)Prepare the journal entry to record deferred income taxes for 2023. (Credit account titles are automatically indented when theamount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Listdebit entry before credit entry.)Account Titles and ExplanationDebitCredit

Given in the question: Accounting Income in 2023 = $1,130,000 Tax Rate = 20% Accrued Warranty…

Prepare the journal entry to record deferred income taxes for 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.)

Prepare the journal entry to record deferred income taxes for 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.)

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 2P

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