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What would the tax entries be

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Question - In the first year of operations, 2018, ABC Ltd. reports a taxable income of $80,000 and paid $22,000 of income taxes. It is now the end of 2019, and ABC Ltd. has had a loss of $100,000 for tax purposes. ABC's management believes it is unlikely the company will be able to use up its tax losses in the future, as its costs are now increasing rapidly and demand for its products is declining. The tax rate in 2019 is currently 25% but is expected to increase to 30% starting in 2020 and years after. ABC is not facing a short-term cash crunch as its shareholders still have lots of cash. What would the 2019 tax entries be based on the above information?

Reference no: EM132915566

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