Case recognizes installment income for financial reporting

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Case Development began operations in December 2013. When property is sold on an installment basis, Case recognizes installment income for financial reporting purposes in the year of the sale. For tax purposes, installment income is reported by the installment method. 2013 installment income was $600,000 and will be collected over the next three years. Scheduled collections and enacted tax rates for 2014-2016 are as follows:

Pretax accounting income for 2013 was $810,000, which includes interest revenue of $10,000 from municipal bonds. The enacted tax rate for 2013 is 30%.

Required:
1. Assuming no differences between accounting income and taxable income other than those described above, prepare the appropriate journal entry to record Case 's 2013 income taxes.
2. What is Case 's 2013 net income?
3. How should the deferred tax amount be classified in a classified balance sheet?

Reference no: EM13880264

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