Starfleet Corporation has one temporary difference at the end of 2012
that will reverse and cause taxable amounts of $55,000 in 2013, $60,000
in 2014, and $75,000 in 2015. Starfleet\'s pretax financial income for
2012 is $400,000, and the tax rate is 30% for all years. There are no
deferred taxes at the beginning of 2012.
Required:
(a) Compute taxable income and income taxes payable for 2012.
(b) Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes payable for 2012.
(c) Prepare the income tax expense section of the income
statement for 2012, beginning with the line \"Income before income
taxes.\"
