In 2020, DFS medical supply recognized rent revenue of 500 for financial accounting purpose and...
50.1K
Verified Solution
Link Copied!
Question
Accounting
In 2020, DFS medical supply recognized rent revenue of 500 for financial accounting purpose and collected $600 cash for next year's rent. Unearned rent revenue at the beginning of 2020 was $80. For income tax reporting, the rent is taxed when collected. Pre-tax accounting income was $1600 for 2020.There were no other temporary differences and no permanent differences between taxable income and pre-tax accounting income. The enacted tax rate is 25%.
A) Does the temporary difference due to rent revenue create deferred tax asset or liability? Determine the balance of deferred tax asset (or liability) at the end of the year.
B) Prepare the journal entry to record income tax expense for 2020.
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.