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Wicks Corporation began operations on January 1, 2010. At the end of 2010, the company reported pretax financial income of $60,000 and taxable income of $57,700, due to two temporary differences. The income tax rate is 30% for 2010 through 2012, but Congress has enacted a tax rate of 35% for 2013 and beyond. To determine its deferred taxes, the company prepared the following schedule of expected future taxable and deductible amounts for the two temporary differences:
Required:1. Prepare the income tax journal entry of the Wicks Corporation at the end of 2010. Assume a valuation allowance is not required.2. Prepare the lower portion of the 2010 income statement for the WicksCorporation.
As part of the Strategic Business Plan, you have been asked to:
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