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Mattress System Inc financial statement

josh
September 21, 2016 0 Comment

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Mattress System Inc financial statement
Mattress System Inc. recognized service revenue of $500,000 on its financial statements in 2009. Assume, however, that the tax code requires this amount to be recognized for tax purposes in 2010. The taxable income for 2009 and 2010 is $1,800,000 and $2,400,000, respectively. Assume a tax rate of 40%.

Illustrate the effects on the accounts and financial statements of the tax expense, deferred taxes, and taxes payable for 2009 and 2010, respectively.

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