Quiz 5 ACCT3040Name 1.EMC began operations during 2004.Taxable income in 2005 was $829,000.Basisdifferencesas of 12/31/04 and 12/31/05 are as follows: Description of difference12/31/0412/31/05 Property, Plant, & Equipment, net: GAAP basis$1,102,000$1,880,000 Tax basis1,000,0001,800,000 Basis difference$102,000$80,000 Investments - Trading GAAP basis (fair value)$785,000$823,000 Tax basis (cost or amortized cost)903,000948,000 Basis difference($118,000)($125,000) The enacted income tax rate is 40% for 2004 and all future years. Requirement: Prepare the income tax journal entries that EMC should make for the year ended 12/31/05.
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