Solution-Prepare the journal entry to record abc income tax

Prepare the journal entry to record abc income tax expense

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Reference no: EM132841278

ABC Inc. had the following pretax income (loss) over its first three years of operations:

2019 $500,000

2020 $(900,000)

2021 $1,000,000

For all three years there were neither temporary nor permanent differences and the tax rate was 25%. No valuation account was deemed necessary for the deferred tax asset as of December 31, 2020, or December 31, 2021.

Required:

Problem 1: Prepare the journal entry to record ABC's income tax expense for 2019.

Assume that ABC Inc. operates in an industry for which NOL carry back is allowed:

Problem 2: Prepare the journal entry to record ABC's income tax expense for 2020.

Problem 3: Prepare the journal entry to record ABC's income tax expense for 2021.

Problem 4: In its 2021 balance sheet, what amount should ABC Inc. report as deferred tax asset?

Assume that ABC Inc. operates in an industry for which NOL carry back is not allowed:

Problem 5: Prepare the journal entry to record ABC's income tax expense for 2020.

Problem 6: Prepare the journal entry to record ABC's income tax expense for 2021.

Problem 7: In its 2021 balance sheet, what amount should ABC Inc. report as deferred tax asset?

Reference no: EM132841278

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Prepare the journal entry to record abc income tax expense

Reference no: EM132841278

Reference no: EM132841278

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