At the Beginning of the Current Fiscal Year, Withering Corporation

question 67

Essay

At the beginning of the current fiscal year, Withering Corporation had a deferred income tax liability balance of $20,000, which relates to depreciable assets. During the year, Withering reported the following information:
• Income before income taxes for the year was $300,000 and the tax rate was 45%.
• Depreciation expense was $150,000 and CCA was $130,000.
• Unearned rent revenue was reported at $120,000. Rent revenue is taxable when the cash is received. There was no opening balance in the unearned rent revenue account at the beginning of the year.
• No other items affected deferred tax amounts other than these transactions.
Required:
Prepare the journal entry or entries to record income taxes for the year.

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Definitions:

Sample Observations

Data points collected from a subset of a population for analysis or research.

Probability

The measure of the likelihood that an event will occur, represented as a number between 0 and 1, where 0 indicates impossibility and 1 indicates certainty.

Sample Mean

The average of all the data points in a sample, used as an estimate of the population mean.

French Reluctance

The tendency of France to be hesitant or resistant in certain situations, often in historical contexts involving military or political decisions.