Pole Co. at the end of 2019, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows:Pretax financial income$ 520,000Extra depreciation taken for tax purposes(1,200,000)Estimated expenses deductible for taxes when paid 890,000Taxable income$ 210,000Use of the depreciable assets will result in taxable amounts of $400,000 in each of the next three years. The estimated litigation expenses of $890,000 will be deductible in 2022 when settlement is expected.Instructions(a) Prepare the journal entry to record income tax expense, deferred taxes, and income taxes payable for 2019, assuming a tax rate of 40% for all years.
Pole Co. at the end of 2019, its first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows:Pretax financial income$ 520,000Extra
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