After making four quarterly estimated payments of $3,500, a corporation's actual income tax liability for the year is $17,200. The year-end adjusting entry would require

Question

Quizplus · Accepted Answer

The adjusting entry is necessary to account for the difference between the estimated tax payments made throughout the year and the actual tax liability. Since the actual tax liability is higher than the estimated payments, the adjusting entry will increase the expense recorded for income taxes. Therefore, a debit to Income Tax Expense for $3,200 is the correct choice.

After Making Four Quarterly Estimated Payments of $3,500, a Corporation's