South Carolina Corporation has one temporary difference at the end of 2008 that will reverse and cause taxable amounts

E19-1 (One Temporary difference, Future Taxable Amounts, One Rate, No Beginning Deferred Taxes) South Carolina Corporation has one temporary difference at the end of 2008 that will reverse and cause taxable amounts of  $55,000 in 2009, $60,000 in 2010, and $65,000 in 2011. South Carolina's pretax financial income for 2008 is $300,000 and the tax rate us 30% for all years. There are no deferred taxes at the beginning of 2008.

Instructions
a.) Compute taxable income and income taxes payable for 20008.
b.) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2008.
c.) Prepare the income tax expense section of the income statement for 2008, beginning with the line "Income before income taxes"

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Button Company has two temporary differences between its income tax expense and income taxes payable

E19-8 (Two Temporary Differences, One Rate, 3 years) Button Company has two temporary differences between its income tax expense and income taxes payable. The information is shown on page 1004.

2007 2008 2009
Personal Financial income $840,000 $910,000 $945,000
Excess depreciation expense on tax return (30,000) (40,000) (10,000)
Excess warranty expense in financial income 20,000 10,000 8,000
Taxable Income 830,000 880,000 943,000

Income tax rate for all years = 40%

Prepare the income tax expense sectin of the income statement for 2009, beginning with the line "Pretax financial income."


Click here for the solution: Button Company has two temporary differences between its income tax expense and income taxes payable