In 2016, Its First Year of Operations, Wilber Company Reported

question 5

Multiple Choice

In 2016, its first year of operations, Wilber Company reported pretax accounting income of $60,000. Included in the $60,000 was an expense for accrued, unpaid warranty costs of $8,000, which are not deductible until paid for income tax purposes. Wilber's income tax rate was 20%. The entry to record the income tax expense would include a

• A) credit to Income Tax Expense for $12,000.
• B) credit to Income Taxes Payable for $12,000.
• C) credit to Deferred Tax Liability for $1,600.
• D) debit to Deferred Tax Asset for $1,600.

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Definitions:

Ethnicity

A social group that shares a common and distinctive culture, religion, language, or the like, often connected by a shared heritage and ancestry.

Social class

A division of a society based on social and economic status, influencing an individual's opportunities, lifestyle, attitudes, and behavior.

Grandmothers

Women who are the mothers of one’s parents, often playing a significant role in family structures and childcare.

Care

The provision of what is necessary for the health, welfare, maintenance, and protection of someone or something.