Itchy Company's Actual Earnings for the First Two Quarters of 2014

Essay

Itchy Company's actual earnings for the first two quarters of 2014 and its estimate during each quarter of its annual earnings are: $\begin{array}{lr}\text { Actual first-quarter eamings } & \$ 800,000 \\\text { Actual second-quarter earnings } & 1,020,000 \\\text { First-quarter estimate of annual earnings } & 2,700,000 \\\text { Second-quarter estimate of annual earnings } & 2,830,000\end{array}$
Itchy Company estimated its permanent differences between accounting income and taxable income for 2014 as: $\begin{array}{lr}\text { Environmental violation penalties } & \$ 45,000 \\\text { Dividend income exclusion } & 320,000\end{array}$
These estimates did not change during the second quarter.The combined state and federal tax rate for Itchy Company for 2014 is 40%.
Required:
Prepare journal entries to record Itchy Company's provisions for income taxes for each of the first two quarters of 2014.