Question

In year 1, Heron Corp. has depreciation expense for income statement purposes of $10,000. The depreciation deduction on the tax return was $14,000. The enacted tax rate is 30%. Heron's pretax income for the year was $80,000, and its taxable income was $76,000. If this is the only difference between pretax income and taxable income, the journal entry to record tax expense for the year would include which of the following entries? a) debit tax expense of $22,800
b) credit deferred tax liability of $4,000
c) debit tax expense of $24,000
d) credit taxes payable of $22,800
e) credit deferred tax liability of $1,200

Answer 1

C and e , if it’s select more then one