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E19-2B (Two Differences, No Beginning Deferred Taxes, Tracked through 2 Years)The following information is available for DirectMedia Inc. for 2014. 1. Excess of tax depreciation over book depreciation, $80,000. This $80,000 difference will reverse equally

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E19-2B (Two Differences, No Beginning Deferred Taxes, Tracked through 2 Years)The following information is available for DirectMedia Inc. for 2014.;1. Excess of tax depreciation over book depreciation, $80,000. This $80,000 difference will reverse equally over the next 4 years.;2. Deferral, for book purposes, of $25,000 of subscription income received in advance. The subscription income will be earned in 2015.;3. Pretax financial income, $160,000.;4. Tax rate for all years, 35%.;Instructions;(a) Compute taxable income for 2014.;(b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2014.;(c) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2015, assuming taxable income of $255,000.

 

Paper#75334 | Written in 18-Jul-2015

Price : $27
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