Question

Provincial Inc. reported the following before-tax income statement items:

Answer 1

Answer:

The income tax expense is $122,750

Explanation:

The computation of the amount of income tax expense is shown below:

As we know that

Income before tax = Operating income - non operating losses

= $580,000 - $89,000

= $491,000

Now the income tax expense is

= Income before tax × income tax rate

= $491,000 × 25%

= $122,750

Hence, the income tax expense is $122,750

This is the answer but the same is not provided in the given options