During the year, Income Tax Expense amounted to $30,000 and Income Taxes Payable increased by $4,000; therefore, the cash paid for income taxes was $26,000.

Question

Quizplus · Accepted Answer

Income Tax Expense is an accrual-based expense, while Income Taxes Payable is a cash-based liability. Therefore, the difference between the two represents the change in the cash balance due to income taxes.

During the Year, Income Tax Expense Amounted to $30,000 and Income