Problem

Swift company began its operations at the beginning of 2015. The following information pertains to the company:

1) Sales transaction $150,000 has been recognized. It will be fully recognized for tax purpose in 2016.

2) Purchased machinery for $100,000,000. They used straight-line method for depreciation. Its lifetime period is 8 years for accounting purpose and 4 years for tax purpose.

3) Warranty expenses is $50,000,000 during 2015. They estimated that the warrant would be claimed in 2016 for $25,000,000 and in 2017 for $25,000?000.

4) A $10,000,000 fine was paid for tax penalty.

5) Pretax financial income in 2015 is $350,000,000

6) Tax rate in 2015 and the next few years is 25%

7) They estimate for the next few year, they won't obtain tax losses

QUESTION

A. Compute taxable income for 2015
B. Compute income tax payable/current tax expense for 2015
C. Compute tax deferred liability or asset (if any) reported in 2015
D. Prepare journal entries for income tax payable, deferred tax, and income tax expense