Piper, Inc. reported a net deferred tax asset balance of $166,650 resulting from an estimated warranty expense accrual for book purposes. The total book-tax difference related to the bases of the estimated warranty liability is $505,000. The enacted statutory tax rate related to this balance changed from 33% to 28%, effective immediately. What journal entry will Piper need to make to adjust for this change in tax rates? Group of answer choices Deferred Tax Asset 25,250 Income Tax Payable 25,250 Income Tax Expense 25,250 Deferred Tax Asset 25,250 Income Tax Expense 46,662 Deferred Tax Asset 46,662 Deferred Tax Asset 46,662 Income Tax Payable 46,662
Piper, Inc. reported a net deferred tax asset balance of $166,650 resulting from an estimated warranty expense accrual for book purposes. The total book-tax difference related to the bases of the estimated warranty liability is $505,000. The enacted statutory tax rate related to this balance changed from 33% to 28%, effective immediately. What journal entry will Piper need to make to adjust for this change in tax rates? Group of answer choices Deferred Tax Asset 25,250 Income Tax Payable 25,250 Income Tax Expense 25,250 Deferred Tax Asset 25,250 Income Tax Expense 46,662 Deferred Tax Asset 46,662 Deferred Tax Asset 46,662 Income Tax Payable 46,662
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter3: Taxes On The Financial Statements
Section: Chapter Questions
Problem 14P
Related questions
Question
Piper, Inc. reported a net deferred tax asset balance of $166,650 resulting from an estimated warranty expense accrual for book purposes. The total book-tax difference related to the bases of the estimated warranty liability is $505,000. The enacted statutory tax rate related to this balance changed from 33% to 28%, effective immediately. What journal entry will Piper need to make to adjust for this change in tax rates?
Group of answer choices
| Deferred Tax Asset | 25,250 | |
| Income Tax Payable | | 25,250 |
| Income Tax Expense | 25,250 | |
| Deferred Tax Asset | | 25,250 |
| Income Tax Expense | 46,662 | |
| Deferred Tax Asset | | 46,662 |
| Deferred Tax Asset | 46,662 | |
| Income Tax Payable | | 46,662 |
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