Question: Temporary Differences, Deferred Tax Assets and Liabilities. Reconciliation between Statutory Tax Rate and Effective Tax Rate J.W. Jones Markets, Inc. accepts prepaid grocery orders for home and commercial delivery. This year, the company collected $160,000 in advance orders. J.W Jones delivered $48,000 in grocery orders this year. The company paid $15,000 in insurance premiums for a policy covering the life of its founder and CEO Income before considering any revenue recognized on the delivered groceries and the insurance expense is $800,000. J.W. Jones is subject to a 40% income tax rate.
Required: a. Prepare the journal entry to record the current year's income tax provision.
b. Prepare the footnote, in dollars and percentages, to reconcile the company's federal income tax rate to its effective (actual) tax rate.