Use the Information Below to Answer the Following Questions:
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question 48

Short Answer

Use the information below to answer the following questions:
On 30 June 2012, Albion Ltd calculates that its 2012 income taxes are $4 570 000. On 15 December 2012, Albion Ltd mails its cheque for this amount to the Australian Taxation Office.
-What is the journal entry made by Albion Ltd on 30 June 2012?
A. DR Income tax payable $\quad$ CR Income tax expense

B. DR Income tax expense $\quad$ CR Cash

C. DR Income tax payable $\quad$ CR Cash

D. DR Income tax expense $\quad$ CR Income tax payable

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Definitions:

Semiannual Amortization

The process of gradually writing off the initial cost of an asset over a period, with adjustments made twice a year.

Amortization

The gradual reduction of a debt over a period of time through regular payments, which cover interest and principal.

Interest Expense

The cost incurred by an entity for borrowed funds, typically noted on the income statement as a non-operating expense.

Issued

Refers to securities, such as stocks or bonds, that have been made available for sale and have been purchased by investors.