8. In 2020, Ross Stores had reported a deferred tax asset of $146 million with no valuation allowance. At December 31, 2021, the account balances of Ross showed a deferred tax asset of $190 million before assessing the need for a valuation allowance and income taxes payable of $94 million. Ross determined that it was more likely than not that 30% of the deferred tax asset ultimately would not be realized. Ross made no estimated tax payments during 2021. What amount should Ross report as income tax expense in its 2021 income statement? (Round your calculations to the nearest whole million.)   Multiple Choice   $57 million   $107 million   $144 million   $94 million

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A:

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Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.