Prepare the journal entries to record income tax expense

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Depreciation reported on the tax return exceeded depreciation reported on the income statement by $128,000. This difference will reverse in equal amounts of $32,000 over the years 2015-2018.
Interest received on municipal bonds was $11,600.
Rent collected in advance on January 1, 2014, totaled $69,900 for a 3-year period. Of this amount, $46,600 was reported as unearned at December 31, 2014, for book purposes.
The tax rates are 50% for 2014 and 45% for 2015 and subsequent years.
Income taxes of $328,600 are due per the tax return for 2014.
No deferred taxes existed at the beginning of 2014.
(a) Compute taxable income for 2014.
(b) Compute pretax financial income for 2014.
(c) Prepare the journal entries to record income tax expense, deferred income taxes, and income taxes payable for 2014 and 2015. Assume taxable income was $980,700 in 2015.

Reference no: EM13215639

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