Prepare a journal entry to record income taxes

Assignment Help Accounting Basics

Reference no: EM131914742

Problem

Minnetonka Corporation began operations in January 2016 and purchased a machine for $20,000. Minnetonka used straight line depreciation over a four year period for financial reporting purposes. For tax purposes, the deduction is 50% of cost in 2016, 30% in 2017, and 20% in 2018. Pretax accounting income for 2016 was $150,000, which includes interest revenue of $20,000 from municipal bonds. the enacted tax rate is 30% for all years. there is no other differences between accounting and taxable income.

Prepare a journal entry to record income taxes for the year 2016. Show well labeled computations for the amount of income tax payable and the change in the deferred tax account.

Reference no: EM131914742

Questions Cloud

What value should be attributed to land in a balance sheet : Mittelstaedt Inc.,buys 60 percent of the outstanding stock. What value should be attributed to the land in a consolidated balance sheet at the date of takeover?

What are other reasons for data files : program does not have run all the time and when your computer is rebooted the state of the data is preserved. What are other reasons for data files?

Identify and discuss why the situation represents a risk : BPharm Ltd is a family-owned company operating chemist shops in Albany. Identify and discuss why the above situation represents a risk

Create a program that keeps track : Create a program that keeps track of specific information for Students. The information stored should be the following: First Name, Last

Prepare a journal entry to record income taxes : Prepare a journal entry to record income taxes for the year 2016. Show well labeled computations for the amount of income tax payable.

Why marketing messages appeal to ethnic and racial : 1) Examine why marketing messages appeal to ethnic and racial identities.

How does preparedstatement prevent this problem : provide un-validated input to your SQL queries, then they can inject SQL code into part of the query that is then executed. How does PreparedStatement prevent

Biggest problem in communication : George Bernard Shaw is quoted as saying, "The single biggest problem in communication is the illusion that it has taken place." To disseminate

Sample project describing the organizational structure : You are going to discuss sample project describing the organizational structure of the agency or company for which you are planning the project.

User Account

All Pages