Answer:
a. Income Tax Expense (Dr.) $298,000
Deferred Tax (Dr.) $30,000
Income Tax Payable (Cr.) $328,000
Step-by-step explanation:
b. Income Tax expense (Dr.) $30,000
Allowance to reduce deferred tax value to NRV (Cr.) $30,000
Income tax payable is calculated based on tax rate of 40%.
$820,000 * 40% = $382,000