Problem
In 2019 to 2021 respectively, Crypto Co. (CC) earned taxable income of $500,000, $800,000 and $700,000, and paid income tax of $150,000, $260,000, and $200,000. It is now the end of 2022 and the company has incurred a loss of $3,500,000 for tax purposes and earns an accounting loss before tax of $3,000,000. The difference between accounting and taxable income is due to CCA exceeding depreciation expense. The tax rate is currently 30%. CC anticipates using only 60% of the losses carried forward within the allowable carryforward period.
Task
Record the journal entries for income tax expense and income tax payable or receivable for 2022, showing all necessary supporting computations.