Answered

At Westonci.ca, we provide reliable answers to your questions from a community of experts. Start exploring today! Get immediate answers to your questions from a wide network of experienced professionals on our Q&A platform. Experience the convenience of finding accurate answers to your questions from knowledgeable experts on our platform.

In 2021, Ryan Management collected rent revenue for 2022 tenant occupancy. For financial reporting, the rent is recorded as deferred revenue and then recognized as revenue in the period tenants occupy rental property. For tax reporting, the rent is taxed when collected in 2021. The deferred portion of the rent collected in 2021 was $50 million. No temporary differences existed at the beginning of the year, and the tax rate is 25%. Suppose the deferred portion of the rent collected was $40 million at the end of 2022. Taxable income is $200 million.


Required:

Prepare the appropriate journal entry to record income taxes Iin 2022

Sagot :

abiolataiwo2015

Answer:

Dr Income tax expense $52.50

Cr To Income taxes payable $50.00

Cr To Deferred tax assets $2.50

Explanation:

Preparation of the appropriate journal entry to record income taxes Iin 2022

Based on the information given the appropriate journal entry to record income taxes Iin 2022

31-Dec-22 (in millions)

Dr Income tax expense $52.50

Cr To Income taxes payable $50.00

Cr To Deferred tax assets $2.50

($50-$10*25%)

(Being To record income tax expense)

Thank you for choosing our platform. We're dedicated to providing the best answers for all your questions. Visit us again. Thanks for using our service. We're always here to provide accurate and up-to-date answers to all your queries. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.