GinnyCo has pretax book and taxable income of $400,000 and reports a s100,000 income tax payable in the current year. GinnyCo has engaged in activities that it believes qualify for the research activities credit a general business tax credit of $40,000 that it cannot use this year, and its management believes that it is more likely than not that one-fourth of the credit carryforward will expire unused, a. Compute GinnyCo's income tax provision for the year, expressed as a Microsoft Excel formula. b. Construct the journal entry to report these items. JOURNAL DATE Description Post. Ref. Debit Credit Income tax payable Deferred tax asset

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Problem 3-44 (LO. 5)
GinnyCo has pretax book and taxable income of $400,000 and reports a s100,000 income tax payable in the current year. GinnyCo has
engaged in activities that it believes qualify for the research activities credit a general business tax credit of $40,000 that it cannot use
this year, and its management believes that it is more likely than not that one-fourth of the credit carryforward will expire unused,
a. Compute GinnyCo's income tax provision for the year, expressed as a Microsoft Excel formula.
b. Construct the journal entry to report these items.
JOURNAL
DATE
Description
Post. Ref.
Debit
Credit
Income tax payable
Deferred tax asset
Transcribed Image Text:Problem 3-44 (LO. 5) GinnyCo has pretax book and taxable income of $400,000 and reports a s100,000 income tax payable in the current year. GinnyCo has engaged in activities that it believes qualify for the research activities credit a general business tax credit of $40,000 that it cannot use this year, and its management believes that it is more likely than not that one-fourth of the credit carryforward will expire unused, a. Compute GinnyCo's income tax provision for the year, expressed as a Microsoft Excel formula. b. Construct the journal entry to report these items. JOURNAL DATE Description Post. Ref. Debit Credit Income tax payable Deferred tax asset
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