AC 302 Chapter 19 Question 1

AC 302 Chapter 19 Question 1

Name				Date		
Instructor				Course		
Intermediate Accounting 14th Edition by Kieso Weygandt and Warfield						
Primer on Using Excel in Accounting by Rex A Schildhouse						
						
E19-1 (One Temporary Difference, Future Taxable Amounts, One Rate, No Beginning Deferred 						
Taxes) Starfleet Corporation has one temporary difference at the end of 2012 that will reverse and 						
cause taxable amounts of		$55,000 	in 2013,	$60,000 	in 2014, and	$75,000 
in 2015. Starfleet- pretax financial income for 2012 is				$400,000 	and the tax rate is	
30%	for all years. There are no deferred taxes at the beginning of 2012.					
						
Instructions:						
(a) Compute taxable income and income taxes payable for 2012.						
						
	Pretax financial income for 2012					Amount
	"Temporary difference resulting in future
           taxable amounts in year:"					
				2013	Amount	
				2014	Amount	
				2015	Amount	Formula
	Taxable income for 2012					Formula
	Enacted tax rate					Percentage
	Income tax payable for 2012					Formula
						
"(b) Prepare the journal entry to record income tax expense, deferred income taxes, and income
     taxes payable for 2012."						
						
						
Future Years			2013	2014	2015	Total
Future taxable (deductible) amounts			Amount	Amount	Amount	Formula
Tax rate			Percentage	Percentage	Percentage	
Deferred tax liability (asset)			Formula	Formula	Formula	Formula
						
	Deferred tax liability at the end of 2012					Formula
	Deferred tax liability at the beginning of 2012					Amount
	Deferred tax expense for 2012 (increase in deferred tax liability)					Formula
	Current tax expense for 2012 (Income tax payable)					Amount
	Income tax expense for 2012					Formula
						
	Account Title				Formula	
	Account Title					Amount
	Account Title					Amount
						
"(c) Prepare the income tax expense section of the income statement for 2012, beginning with the
     line ""Income before income taxes."""						
						
						
	Income before income taxes				Amount	
	Income tax expense					
	Current			Amount		
	Deferred			Amount	Formula	
	Net income after income taxes				Formula