In the Current Year, Bruno Corporation Collected Rent of $3,600,000

question 39

Essay

In the current year, Bruno Corporation collected rent of $3,600,000. For income tax reporting, the rent is taxed when collected. For financial reporting, the rent is recognized as income in the period earned. At the end of the current year, the unearned portion of the rent collected in the current year amounted to $400,000. Bruno had no temporary differences at the beginning of the current year. Assume an income tax rate of 30%.
Required:
The current year's income tax liability from the tax return is $800,000. Prepare the journal entry to record income taxes for the year. Show well-labeled computations.

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Definitions:

Natural Selection

The process by which biological traits become more or less common in a population due to consistent effects on the survival and reproduction of their bearers.

Evolutionary

Pertaining to the process of natural selection and adaptation over generations, affecting the development of biological species.

Information Processing

A cognitive approach that describes the ways in which human beings encode, store, and retrieve information.

Human Factors Engineering

The discipline focused on designing systems, products, and processes that enhance human safety, performance, and satisfaction by considering human limitations and capabilities.