Reference no: EM131831416

Question - Lance Lawn Service reports bad debt expenses using the allowance method. For tax purposes, the expense is deducted when accounts prove uncollectible (the direct write-off method). At December 31, 2011, Lance has accounts receivable and an allowance for uncollectible accounts of $20 million and $1 million, respectively,and taxable income of $70 million. St december 31, 2010. Lance reported a deferred tax asset of $490,000 related to his difference in reporting bad debts, its only temporary difference. The enacted tax rate is 36% each year. Prepare the appropriate journal entry to recod Lance's income tax provision for 2011.