The entry to accrue $2,000 of income tax monthly is

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The entry to accrue $2,000 of income tax monthly is to record an expense for income tax (Income tax expense) and create a liability for the taxes owed (Accrued income tax payable). Deferred income tax is for the temporary differences between financial reporting and tax reporting, so it is not applicable here. Option B is incorrect because it suggests creating a liability for deferred income tax, which is not relevant to this scenario. Option D is incorrect because the liability should be created for accrued income tax payable, not the other way around. Option E is also incorrect because income taxes are recognized as an expense in the period they are incurred, not necessarily when paid.

The Entry to Accrue $2,000 of Income Tax Monthly Is Deferred income tax 2,000 Income tax expense 2,000\begin{array}{lc}\text { Deferred income tax } & 2,000 \\\quad \text { Income tax expense } & &2,000\\\end{array} Deferred income tax Income tax expense ​2,000​2,000​

The Entry to Accrue $2,000 of Income Tax Monthly Is $\begin{array}{lc}\text { Deferred income tax } & 2,000 \\\quad \text { Income tax expense } & &2,000\\\end{array}$