80.2K

Verified Solution

Link Copied!

Crane Inc. reports the following pretax income $($loss$)$ for both financial reporting purposes and tax purposes. Crane Inc. follows IFRS.

The tax rates were all enacted by the beginning of $2023.$

Prepare the journal entries for the years $2023$ to $2026$ to record income taxes, assuming the tax loss is first carried back and that

at the end of each year, the loss carryforward benefits are judged more likely than not to be realized in the future. $($Credit account

titles are autamatically indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the

account titles and enter $0$ for the amounts. Record journal entries in the order presented in the problem. List ail debit entries before credit

entries.$)$

Prepare the journal entries for $2025$ and $2026$ assuming that, based on the weight of available evidence, it is more likely than nat

that only $70\%$ of the carryforward benefits will be realized $(30\%$ not expected to be realized$).$ A valuation allowance account is

not used by the comparry. $($Credit account titles are automatically indented when the amount is entered. Do not indent monually. If no

entry is required, select $"Na$ Entry" for the account titles and enter $0$ for the amounts. Record journal entries in the order presented in the

problem. List all debit entries before credit entries.

Answer & Explanation Solved by verified expert

See Answer