Allmond Corporation, organized on January 3, 2018, had pretax accounting income of $32 million and...
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Accounting
Allmond Corporation, organized on January 3, 2018, had pretax accounting income of $32 million and taxable income of $44 million for the year ended December 31, 2018. The 2018 tax rate is 35%. The only difference between accounting income and taxable income is estimated product warranty costs. Expected payments and scheduled tax rates (based on recent tax legislation) are as follows:
| 2019 | $ | 3 million | 30 | % |
| 2020 | 3 million | 30 | % | |
| 2021 | 2 million | 30 | % | |
| 2022 | 4 million | 25 | % | |
Required: 1. Determine the amounts necessary to record Allmonds income taxes for 2018 and prepare the appropriate journal entry. 2. What is Allmonds 2018 net income?
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