Turbox Business Incorporated calculates tax due but it does not enter the amount to the current year's Retained Earnings section (tax is paid out of R/E). So, I have to do a prior period adjustment 3720 in R/E section to record the tax paid last year. Is this the right way to handle each year's tax payment?
I don't think CRA would like to see prior period adjustment every year. I would appreciate knowing how to handle this properly every year.
Thanks!