90.2K

Verified Solution

Link Copied!

At the end of $2023,$ Payne Industries had a deferred tax asset account with a balance of $$35$ million attributable to a temporary book tax difference of $$140$ million in a liability for estimated expenses. At the end of $2024,$ the temporary difference is $$96$ million. Payne has no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for $2024$ is $$252$ million and the tax rate is $25\%.$

Required:

Prepare the journal entry$($s$)$ to record Payne's income taxes for $2024,$ assuming it is more likely than not that the deferred tax asset will be realized in full.

Prepare the journal entry$($s$)$ to record Payne's income taxes for $2024,$ assuming it is more likely than not that only one$-$fourth of the deferred tax asset ultimately will be realized.

Answer is not complete.

Complete this question by entering your answers in the tabs below.

Required $1$

Required $2$

Prepare the journal entry$($s$)$ to record Payne's income taxes for $2024,$ assuming it is more likely than not that the deferred tax asset will be realized in full.

Note: If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in millions $($i$.$e$.,10,000,000$ should be entered as $10).$

Show less $1$

$\backslash$table$[[\frac{No}{1},$Transaction,General Journal,Debit,Credit$],[1,$Income tax expense,$0,1,012,500,],[,$Deferred tax asset,V$,920,000x,],[,$Income tax payable,$(,,92,500$

Answer & Explanation Solved by verified expert

See Answer