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Question - Hubler Company reported pretax accounting income of $45 million in 2017. Included in this number was $10 million of depreciation expense calculated under the straight line method. Also included in this number was an expense of $6 million attributed to an environmental fine imposed by a state government agency. Tax depreciation for 2017 will be $15 million. The environmental fine will NOT be deductible ever for income tax purposes. These are the ONLY two differences between accounting and taxable income in 2017. The 2017 income tax rate is 30%.
Please prepare the adjusting entry to record income tax expense, income tax payable, and deferred income taxes.
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