For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $ 265,000 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its deferred income tax liability as of the end of its first year of operations?
For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows: Pretax accounting income $ 300,000 Permanent difference (15,000 ) 285,000 Temporary difference-depreciation (20,000 ) Taxable income $ 265,000 Tringali's tax rate is 25%. Assume that no estimated taxes have been paid. What should Tringali report as its deferred income tax liability as of the end of its first year of operations?
Chapter2: The Domestic And International Financial Marketplace
Section2.A: Taxes
Problem 2P
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For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as follows:
Pretax accounting income | $ | 300,000 | ||
Permanent difference | (15,000 | ) | ||
285,000 | ||||
Temporary difference- |
(20,000 | ) | ||
Taxable income | $ | 265,000 | ||
Tringali's tax rate is 25%. Assume that no estimated taxes have been paid.
What should Tringali report as its
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