At the beginning of 2021, Cullumber Co. purchased an asset for $1850000 with an estimated useful life of 5 years and an estimated salvage value of $151000. For financial reporting purposes the asset is being depreciated using the straight-line method; for tax purposes the double-declining-balance method is being used. Cullumber Co.’s tax rate is 20% for 2021 and all future years. At the end of 2021, which of the following deferred tax accounts and balances is reported on Cullumber’s balance sheet? Account Balance Deferred tax liability $67960 Deferred tax asset $67960 Deferred tax asset $80040 Deferred tax liability $80040
At the beginning of 2021, Cullumber Co. purchased an asset for $1850000 with an estimated useful life of 5 years and an estimated salvage value of $151000. For financial reporting purposes the asset is being depreciated using the straight-line method; for tax purposes the double-declining-balance method is being used. Cullumber Co.’s tax rate is 20% for 2021 and all future years. At the end of 2021, which of the following deferred tax accounts and balances is reported on Cullumber’s balance sheet? Account Balance Deferred tax liability $67960 Deferred tax asset $67960 Deferred tax asset $80040 Deferred tax liability $80040
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...
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At the beginning of 2021, Cullumber Co. purchased an asset for $1850000 with an estimated useful life of 5 years and an estimated salvage value of $151000. For financial reporting purposes the asset is being
At the end of 2021, which of the following
Account | Balance |
$67960 |
$67960 |
Deferred tax asset | $80040 |
Deferred tax liability | $80040 |
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