How to prepare the journal entries related to deferred tax

Assignment Help Financial Accounting
Reference no: EM132564239

The accounting records of Perkins Inc. show the following data for 2019. Pretax financial income was $640,000. Life insurance expense on officers was $16,000. Equipment was acquired in early January for $450,000, straight-line depreciation over 5 year life is used, with no salvage value. For tax purposes, Perkins Inc. used a 40% rate to calculate depreciation. Product warranties were estimated to be $75,000 in 2018. Actual repair and labor costs related to the warranties in 2019 were $15,000 and the remainder is estimated to be paid evenly in 2029 and 2021. Sales on an accrual basis were $160,000. For tax purposes, $90,000 was recorded on the installment sales method. Fines incurred for pollution violations were $3,600. The tax rate is 30%.

Question 1: Prepare the journal entries related to Deferred Tax in 2019.

Reference no: EM132564239

Questions Cloud

Number of inmates who are being victimized by assaults : The Governor is concerned with the number of inmates who are being victimized by assaults, including sexual assaults and stabbings and beatings
Ceo of frank all-american barbeque : Frank Rainsford has been, in effect, the CEO of Frank's All-American BarBeQue since its inception. His major role has been
What are the smtp and mime standards : What are the SMTP and MIME standards? What is the difference between a MIME content type and a MIME transfer encoding? Briefly explain base64 encoding.
Provide the journal entry to account for depreciation : Provide the appropriate journal entry at 30 June 2022 to account for the impairment. Provide the journal entry to account for depreciation in 2023
How to prepare the journal entries related to deferred tax : For tax purposes, $90,000 was recorded on the installment sales method. Prepare the journal entries related to Deferred Tax in 2019.
How to prepare the journal entries related to warranty : How to Prepare the journal entries related to warranty. Viggo Factory provides a 2-year warranty with one of its products, which was first sold in 2019.
Use racial profiling to fight gang formation : What legal, constitutional, or social dilemmas are created for police departments that use racial profiling to fight gang formation?
Discussing the reasons for the two new auditing roles : Write an essay of at least 500 words discussing the reasons for the two new auditing roles in Oracle 12c. Why did Oracle consider them necessary? What problems.
Explain the process of motivation : Research and answer the following questions: Explain the process of motivation.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Intangible assets section of sappelt company

A. The intangible assets section of Sappelt Company at December 31, 2015, is presented below.

  The amount of the gain or loss on retirement of the bonds

On March 31, 2011, Hanson Corporation sold $9,000,000 of its 8%, 10-year bonds for $8,653,500 including accrued interest. The bonds were dated January 1, 2011. Interest is paid semiannually on January 1 and July 1. What was the amount of the gain or ..

  Marketing department prepared first-quarter sales forecast

Tim's Temple Tools sells small eyeglass repair tools for $1.25 each. Tim's marketing department prepared the following first-quarter sales forecast (in units): Required: Prepare Tim's sales budget for each month of the quarter. January February March..

  Solve the firm net income

Solve the firm net income. Garden Pro Corporation has sales of $4,016,358; income tax of $568,419; the selling, general and administrative

  Instrument divisions income from operations increase

Materials used by the Instrument Division of Dart Industries are currently purchased from outside suppliers at a cost of $180 per unit. However, the same materials are available from the Components Division. How much would the Instrument Division's i..

  How much will pay for the bond if purchased bond today

Robin Hood Inc. bond is an annual-coupon bond. Par value of the bond is $1,000. How much you will pay for the bond if you purchased the bond today?

  What is the net present value of the proposed project

The company requires a minimum pretax return of 18% on all investment projects. What is the net present value of the proposed project?

  Prepare the journal entries to account for the events

Prepare the journal entries to account for the events and transactions in relation to the machine between 1 July 2017 and 31 December 2020.

  What is the weighted-average number of shares calculated

Cooren Ltd has 1 520 000 ordinary shares, What is the weighted-average number of shares calculated in accordance with AASB 133?

  Rate of depreciation-plant assets under composite method

Compute the rate of depreciation per year to be applied to the plant assets under the composite method. Prepare the adjusting entry necessary at the end of the year to record depreciation for the year. Prepare the entry to record the sale of asset D ..

  Management has three part

Pablo Management has three part-time employees, each of whom earns $130 per day. They are normally paid on Fridays for work completed Monday through Friday of the same week

  Calculate depreciation expense per mile

Calculate depreciation expense per mile under units-of-activity method - depreciation method for each bus, and various methods were selected. Information concerning the buses is summarized below.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd