Micro Limited has shown a prepaid rent balance of $8,000 under current assets in their balance sheet. The tax rate is 30%. The deferred tax item to be recognised by Micro Limited is: Select one: a. Deferred tax asset of $2,400. b. Deferred tax liability of $2,400. c. Deferred tax liability of $8,000. d. Deferred tax asset of $8,000.
Micro Limited has shown a prepaid rent balance of $8,000 under current assets in their balance sheet. The tax rate is 30%. The deferred tax item to be recognised by Micro Limited is: Select one: a. Deferred tax asset of $2,400. b. Deferred tax liability of $2,400. c. Deferred tax liability of $8,000. d. Deferred tax asset of $8,000.
Chapter14: Taxes On The Financial Statements
Section: Chapter Questions
Problem 22CE
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Question
Micro Limited has shown a prepaid rent balance of $8,000 under current assets in their balance sheet. The tax rate is 30%. The deferred tax item to be recognised by Micro Limited is:
Select one:
a. Deferred tax asset of $2,400.
b. Deferred tax liability of $2,400.
c. Deferred tax liability of $8,000.
d. Deferred tax asset of $8,000.
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