On October 1, 2005, Anaconda Company estimated an effective income tax rate of 42% for the fiscal year ending September 30, 2006. On January 2, 2006, Anaconda changed the estimate to 38%. Pre-tax financial income for Anaconda for the first two quarters of the fiscal year ending September 30, 2006, was as follows:
Prepare journal entries for income taxes expense for Anaconda Company on December 31, 2005, and March 31, 2006. Show supporting computations in explanations for the journal entries.

Question

On October 1, 2005, Anaconda Company estimated an effective income tax rate of 42% for the fiscal year ending September 30, 2006. On January 2, 2006, Anaconda changed the estimate to 38%. Pre-tax financial income for Anaconda for the first two quarters of the fiscal year ending September 30, 2006, was as follows:
  Prepare journal entries for income taxes expense for Anaconda Company on December 31, 2005, and March 31, 2006. Show supporting computations in explanations for the journal entries.

Quizplus · Accepted Answer

The Answer of On October 1, 2005, Anaconda Company estimated an effective income tax rate of 42% for the fiscal year ending September 30, 2006. On January 2, 2006, Anaconda changed the estimate to 38%. Pre-tax financial income for Anaconda for the first two quarters of the fiscal year ending September 30, 2006, was as follows:
  Prepare journal entries for income taxes expense for Anaconda Company on December 31, 2005, and March 31, 2006. Show supporting computations in explanations for the journal entries.

On October 1, 2005, Anaconda Company Estimated an Effective Income