Excel Solution Manual for Intermediate Accounting 18th Edition, by Donald E. Kieso, Jerry J. Weygandt and Terry D. Warfield .Chapter 18

E18.1 (LO1,2) One Temporary Difference, Future Taxable Amounts, One Rate, No Beginning Deferred
Taxes

South Carolina Corporation has one temporary difference at the end of 2025 that will reverse and
cause taxable amounts for the next three years. The respective reversal amounts follow.

2026 2027 2028
Reversal Reversal Reversal
Temporary differences at end of 2025 $ 55,000 $ 60,000 $ 65,000

Other information concerning the company's financial information follows.
South Carolina’s pretax financial income for 2025 $ 300,000
Tax rate for all years 30%
Deferred taxes at the beginning of 2025 $ -

Instructions
a. Compute taxable income and income taxes payable for 2025.
b. Prepare the journal entry to record income tax expense, deferred income taxes, and income taxes
payable for 2025.
c. Prepare the income tax expense section of the income statement for 2025, beginning with the
line "Income before income taxes."

NOTE: Enter a formula, a cell reference, or a value (if you are unable to reference a cell), into
the yellow shaded input cells.


a.




Future Year Future Year Future Year
b. 2026 2027 2028 Total

, Debit Credit




c. Income before income taxes




Net income