At the end of 2016, Sentry Company reported a deferred tax liability of $6,120 based on an income tax rate of 30%. On January 2, 2017, Congress changed the income tax rate to 35%. Required: 1. Calculate the amount of the adjustment to Sentry’s 2016 year-end deferred tax liability. 2. Prepare the journal entry to correct Sentry’s deferred tax liability.
At the end of 2016, Sentry Company reported a deferred tax liability of $6,120 based on an income tax rate of 30%. On January 2, 2017, Congress changed the income tax rate to 35%. Required: 1. Calculate the amount of the adjustment to Sentry’s 2016 year-end deferred tax liability. 2. Prepare the journal entry to correct Sentry’s deferred tax liability.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter18: Accounting For Income Taxes
Section: Chapter Questions
Problem 9MC: Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and...
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At the end of 2016, Sentry Company reported a deferred tax liability of $6,120 based on an income tax rate of 30%. On January 2, 2017, Congress changed the income tax rate to 35%.
Required:
1. | Calculate the amount of the adjustment to Sentry’s 2016 year-end deferred tax liability. |
2. | Prepare the |
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