The Accounting Income (Loss) And Related Tax Rates
The accounting income (loss) and related tax rates during the years 2015 to 2021 follows:
Year Accounting income (loss) Tax Rate
2015 $190,000 22%
2016 95,000 22%
201 (140,000) 22%
2018 90,000 32%
2019 (320,000) 37%
2020 180,000 32%
2021 240,000 27%
Accounting income (loss) and taxable income (loss) were the same for all years since the company began. The tax rates from 2018 to 2021 were enacted in 2018.
Prepare the journal entries to record income taxes for the years 2017 to 2021. Assume the company uses the carryback provision where possible and expects to realize the benefits of any loss carryforward in the year immediately following the loss. Indicate the effect on the December 31, 2019 balance sheet if the company follows ASPE.
How would it be different if the company follows IFRS?
Beginning with “Loss before income tax” shows the bottom of the income statement for 2019
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