The calculation of federal income tax expense is a yea1QuestionThe calculation of federal income tax expense is a year-end adjusting entry but it cannot be made until all other entries have been made and net income before taxes has been determined. Therefore, you must first complete the year-end wo...
The calculation of federal income tax expense is a year-end adjusting entry but
it cannot be made until all other entries have been made and net income before
taxes has been determined. Therefore, you must first complete the year-end
worksheet and calculate net income before taxes. Then calculate federal income
tax expense and post the adjusting entry to the worksheet. (HINT: Use the most
recent rates. For 2023, the tax rate is a straight 21%. You will take 21% of net
income before taxes. You can find these rates in any tax text book or by
referring to the instructions for Schedule J, Form 1120.)
Answer & Explanation
To calculate the federal income tax expense as a year-end adjusting entry,
follow these steps:
1. Complete the Year-End Worksheet:
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