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1. Harms Corporation began 2017 with a $42,000 balance in the Deferred Tax Liability account. At the end of 2017, the re...

1. Harms Corporation began 2017 with a $42,000 balance in the Deferred Tax Liability account. At the end of 2017, the related cumulative temporary difference amounts to $180,000, and it will reverse evenly over the next 2 years. Pretax accounting income for 2017 is $375,000, the tax rate for all years is 40%, and taxable income for 2017 is $300,000.

Taxable income for 2017 300 000

Enacted tax rate 40%

Income taxes payable for 2017 120 000 = (300 000*.40)

(b)Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2017.

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Anscoes Particulars Year LF Dehit Cs)Credit (4)| Income tax eapense Ak Dr C375,000 Kuo) X TO Income tax poyable ¢s Scarned it

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