Discuss the journal entry to record income taxes


Rowen, Inc. had pre-tax accounting income of $1,350,000 and a tax rate of 40% in 2013, its first year of operations. During 2013 the company had the following transactions:

  • Received rent from Jane, Co. for 2014 48,000
  • Municipal bond income 60,000
  • Depreciation for tax purposes in excess of book depreciation 30,000
  • Installment sales revenue to be collected in 2014 81,000

Required:
(a) Prepare a schedule starting with pretax financial income and compute taxable income.
(b) Prepare the journal entry to record income taxes for 2013.

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Accounting Basics: Discuss the journal entry to record income taxes
Reference No:- TGS0702965

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