E19-8 - E19-8(Two Temporary Differences One Rate 3 Years...

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E19-8 (Two Temporary Differences, One Rate, 3  Years) Gordon Company has two temporary  differences between its income tax expense  and income taxes payable. The following  information is available. Pretax financial income Excess of depreciation expense on tax return Excess of warranty expense on financial income Taxable income The income tax rate for all years is 40%. (a)   Date 2012         Date 2013         Date 2014       (b) Assuming there were no temporary differences prior to 2012, indicate how deferred taxes will be reporte   Current  assets         Deferred  tax asset Long term  liabilities      Deferred  tax liabilities    (c) Prepare the income tax expense section of the income statement for 2014, beginning with the line "Pre   Pretax financial income
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Income tax expense       Current       Deferred Net income Solution E19-8 (a) Date Description/Account 2012 Income Tax Expense  
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