In 2013, its first year of operations, Watts Company reported pretax accounting income of $600,000. Included in the $600,000 was an expense for accrued, unpaid warranty costs of $80,000, which are not deductible until paid for income tax purposes. Watts' income tax rate was 30%. Prepare the entry to record the income taxes for 2013 with a description.
Your model for analyzing timing differences is in excel with the journal entry and instructional notes.