MANAGEMENT

Detailed explanation-1: -Tax expense is usually the last line item before the bottom line-net income-on an income statement. For example, if a company earned $100, 000 before taxes and paid $18, 000 in taxes, then the effective tax rate is equal to 18, 000 ÷ 100, 000, or 0.18.

Detailed explanation-2: -To record income tax expense, you will need to make a journal entry that includes a debit to income tax expense and a credit to income tax payable. The income tax expense represents the amount of tax that the company owes for the current period, based on its taxable income.

Detailed explanation-3: -Basically, income tax expense is the company’s calculation of how much it actually pays in taxes during a given accounting period. It usually appears on the next to last line of the income statement, right before the net income calculation.

Detailed explanation-4: -Deferred income tax expense (benefit) represents the anticipated future tax expense (benefit) from activity in past or current periods. These future expenses (benefits) arise due to temporary differences between book and tax value for certain items.