E18-11 Multiple Tax Rates For the year ended December 31, 2019, Nelson Co.’s income statement showed income of $435,000 before income, tax expense. To compute taxable income, the following differences were noted: Income from tax-exempt municipal bonds $60,000 Depreciation deducted for tax purposes in excess of depreciation recorded on the books $120,000 Proceeds received from life insurance on death of an insured employee $100,00 Corporate tax rate for 2019 30% Enacted tax rate for future periods 35% Required: 1. Calculate taxable income and tax payable for tax purposes. 2. Prepare Nelson’s income tax journal entry at the end of 2019.
E18-11 Multiple Tax Rates For the year ended December 31, 2019, Nelson Co.’s income statement showed income of $435,000 before income, tax expense. To compute taxable income, the following differences were noted:
Income from tax-exempt municipal bonds $60,000
Proceeds received from life insurance on death of an insured employee $100,00
Corporate tax rate for 2019 30%
Enacted tax rate for future periods 35%
Required:
1. Calculate taxable income and tax payable for tax purposes.
2. Prepare Nelson’s income tax
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