A business has a corporate income tax rate of 40%.It has made no tax payments for the year 2011.The taxes have to be paid at the end of the first quarter of 2012.Based on the following accounting data for the year-end December 31,2011,which of the following would be the adjusting entry required to be made on December 31,2011 for the taxes?

Question

Quizplus · Accepted Answer

The adjusting entry required to be made on December 31, 2011 for the taxes is to debit Income Tax Expense and credit Income Tax Payable for the amount of taxes owed. The amount of taxes owed is calculated by multiplying the corporate income tax rate by the taxable income.

A Business Has a Corporate Income Tax Rate of 40