At the end of 2023, Payne Industries had a deferred tax asset account with a balance of $110 million attributable to a temporary book-tax difference of $440 million in a liability for estimated expenses. At the end of 2024, the temporary difference is $336 million. Paynehas no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for 2024 is $792 million andthe tax rate is 25%.Required:1. Prepare the journal entry(s) to record Payne's income taxes for 2024, assuming it is more likely than not that the deferred taxasset will be realized in full.2. Prepare the journal entry(s) to record Payne's income taxes for 2024, assuming it is more likely than not that only one-fourth ofthe deferred tax asset ultimately will be realized.Complete this question by entering your answers in the tabs below.Required 1 Required 2Prepare the journal entry(s) to record Payne's income taxes for 2024, assuming it is more likely than not that the deferred tax asset willbe realized in full.Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers inmillions (i.e., 10,000,000 should be entered as 10).View transaction listJournal entry worksheet<12Record 2024 income taxes.Show less

Journal entry records the accounting transactions of a business in a journal book. All the business…

At the end of 2023, Payne Industries had a deferred tax asset account with a balance of $110 million attributable to a temporary book- tax difference of $440 million in a liability for estimated expenses. At the end of 2024, the temporary difference is $336 million. Payne has no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for 2024 is $792 million and the tax rate is 25%.

At the end of 2023, Payne Industries had a deferred tax asset account with a balance of $110 million attributable to a temporary book- tax difference of $440 million in a liability for estimated expenses. At the end of 2024, the temporary difference is $336 million. Payne has no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for 2024 is $792 million and the tax rate is 25%.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter26: Tax Practice And Ethics

Section: Chapter Questions

Problem 32P

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