Assume a corporation underestimated its income tax liability for the year by $4,000 . What, if any, end-of-period adjustment is required?
a. The adjusting entry contains a debit to Income Tax Expense for $4,000, and a credit to Cash for $4,000.
b. The adjusting entry contains a debit to Income Tax Payable for $4,000, and a credit to Income Tax Expense for $4,000.
c. The adjusting entry contains a debit to Income Tax Expense for $4,000, and a credit to Income Tax Payable for $4,000.
d. The adjusting entry contains a debit to Accounts Payable for $4,000, and a credit to Cash for $4,000.
e. No adjustment is required.
c
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If asked about gaps in your work history, you should respond by
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