Answer:
31-Dec-19
Dr Income tax expense $62,590.00
Dr Deferred Tax Assets $4,500.00
Cr To Income Tax Payable $60,520.00
Cr To Deferred tax liability $6,570.00
31-Dec-20
Dr Income tax expense $98,100.00
Dr Deferred Tax Liability $3,285.00
Cr To Income Tax Payable $99,135.00
Cr To Deferred tax Assets $2,250.00
31-Dec-21
Dr Income tax expense $37,440.00
Dr Deferred Tax Liability $3,285.00
Cr To Income Tax Payable $38,475.00
Cr To Deferred tax Assets $2,250.00
Explanation:
Preparation of the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2019, 2020, and 2021
INDIGO CO. JOURNAL ENTRIES
31-Dec-19
Dr Income tax expense $62,590.00
Dr Deferred Tax Assets ($10,000*45%) $4,500.00
Cr To Income Tax Payable $60,520.00
Cr To Deferred tax liability ($14,600*45%) $6,570.00
(Being current income tax and deferred taxes)
31-Dec-20
Dr Income tax expense $98,100.00
Dr Deferred Tax Liability ($7,300*45%) $3,285.00
Cr To Income Tax Payable $99,135.00
Cr To Deferred tax Assets ($5,000*45%) $2,250.00
(Being current income tax and deferred taxes)
31-Dec-21
Dr Income tax expense $37,440.00
Dr Deferred Tax Liability ($7,300*45%) $3,285.00
Cr To Income Tax Payable $38,475.00
Cr To Deferred tax Assets ($5,000*45%) $2,250.00
(Being current income tax and deferred taxes)
