Blossom Inc's only temporary difference at the beginning and end of 2024 is caused by a $3.03 million deferred gain for tax purposesfor an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equalinstallments in 2025 and 2026. The related deferred tax liability at the beginning of the year is $909,000. In the third quarter of 2024,a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $5,050,000, andtaxable income is expected in all future years.(a)Determine the amount reported as a deferred tax liability at the end of 2024.Deferred tax liability$

A Deferred duty liability is created when a duty obligation is accumulated in one fiscal time but…

Answered: (a) Determine the amount reported as a…

Business

Accounting

(a) Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability $

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 5MC: At the beginning of 2019, Conley Company purchased an asset at a cost of 10,000. For financial...

See similar textbooks

Similar questions

Prior to and during 2019, Shadrach Company reported tax depreciation at an amount higher than the amount of financial depreciation, resulting in a book value of the depreciable assets of 24,500 for financial reporting purposes and of 20,000 for tax purposes at the end of 2019. In addition, Shadrach recognized a 3,500 estimated liability for legal expenses in the financial statements during 2019; it expects to pay this liability (and deduct it for tax purposes) in 2023. The current tax rate is 30%, no change in the tax rate has been enacted, and the company expects to be profitable in future years. What is the amount of the net deferred tax liability at the end of 2019? a. 300 b. 450 c. 1,050 d. 1,350
At the beginning of 2019, Conley Company purchased an asset at a cost of 10,000. For financial reporting purposes, the asset has a 4-year life with no residual value and is depreciated by the straight-line method beginning in 2019. For tax purposes, the asset is depreciated under MACRS using a 5-year recovery period. Prior to 2019, Conley had no deferred tax liability or asset. The difference between depreciation for financial reporting purposes and income tax purposes is the only temporary difference between pretax financial income and taxable income. The current income tax rate is 30%, and no change in the tax rate has been enacted for future years. In 2019 and 2020, taxable income will be higher or lower than financial income by what amount?
Sheridan Inc's only temporary difference at the beginning and end of 2024 is caused by a $3.54 million deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2025 and 2026. The related deferred tax liability at the beginning of the year is $1,062,000. In the third quarter of 2024, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $5,900,000. and taxable income is expected in all future years. (a) Your answer is incorrect. Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability $ eTextbook and Media List of Accounts Save for Later Last saved 15 hours ago Attomu
Sandhill Inc.'s only temporary difference at the beginning and end of 2024 is caused by a $3.63 million deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2025 and 2026. The related deferred tax liability at the beginning of the year is $1,089,000. In the third quarter of 2024, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $6,050,000, and taxable income is expected in all future years. (a) Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability tA
Crane Inc's only temporary difference at the beginning and end of 2024 is caused by a $3.72 million deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2025 and 2026. The related deferred tax liability at the beginning of the year is $1.116,000. In the third quarter of 2024, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $6,200,000, and taxable income is expected in all future years. (a) Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability
Sandhill Inc's only temporary difference at the beginning and end of 2024 is caused by a $3.63 million deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2025 and 2026. The related deferred tax liability at the beginning of the year is $1,089,000. In the third quarter of 2024, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2026. Taxable income for 2024 is $6,050,000, and taxable income is expected in all future years. (a) Determine the amount reported as a deferred tax liability at the end of 2024. Deferred tax liability $
Nash Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,690,000 deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1,476,000. In the third quarter of 2019, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2021. Taxable income for 2019 is $6,150,000, and taxable income is expected in all future years. 1.Determine the amount reported as a deferred tax liability at the end of 2019. Deferred tax liability 2.Prepare the journal entry necessary to adjust the deferred tax liability when the new tax rate is enacted into law. 3.Draft the income tax expense portion of the income statement for 2019. Begin with the line “Income before income taxes.” Assume no permanent differences exist
Vaughn Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,300,000 deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1,320,000. In the third quarter of 2019, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2021. Taxable income for 2019 is $5,500,000, and taxable income is expected in all future years. Determine the amount reported as a deferred tax liability at the end of 2019. Deferred tax liability $ Prepare the journal entry necessary to adjust the deferred tax liability when the new tax rate is enacted into law. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0…
Ferrero Rocher Inc.’s only temporary difference at the beginning and end of 2020 is caused by a P3,000,000 total collectible amount for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2021 and 2022. The related deferred tax liability at the beginning of the year is P1,200,000. In the third quarter of 2020, a new tax rate of 34% is enacted into law and is scheduled to become effective for 2021. Taxable income for 2020 is P5,000,000, and taxable income is expected in all future years. How much is the deferred tax liability on December 31, 2020?
Vaughn Inc.’s only temporary difference at the beginning and end of 2019 is caused by a $3,300,000 deferred gain for tax purposes for an installment sale of a plant asset, and the related receivable (only one-half of which is classified as a current asset) is due in equal installments in 2020 and 2021. The related deferred tax liability at the beginning of the year is $1,320,000. In the third quarter of 2019, a new tax rate of 20% is enacted into law and is scheduled to become effective for 2021. Taxable income for 2019 is $5,500,000, and taxable income is expected in all future years. Draft the income tax expense portion of the income statement for 2019. Begin with the line “Income before income taxes.” Assume no permanent differences exist. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Bramble Corp. has a deferred tax asset account with a balance of $68,600 at the end of 2024 due to a single cumulative temporary difference of $343,000. At the end of 2025, this same temporary difference has increased to a cumulative amount of $463,000. Taxable income for 2025 is $824,000. The tax rate is 20% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2024. (a) Record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming that it is more likely than not that the deferred tax asset will be realized. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit
Teal Corp. has a deferred tax asset account with a balance of $78,400 at the end of 2024 due to a single cumulative temporary difference of $392,000. At the end of 2025, this same temporary difference has increased to a cumulative amount of $478,000. Taxable income for 2025 is $884,000. The tax rate is 20% for all years. No valuation account related to the deferred tax asset is in existence at the end of 2024. (a) Record income tax expense, deferred income taxes, and income taxes payable for 2025, assuming that it is more likely than not that the deferred tax asset will be realized. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Account Titles and Explanation Debit Credit (b) Assuming that it is more likely than not that $17,200 of the deferred tax asset will not be realized, prepare the journal…