This is chapter 16 E-11 of Intermediate Accounting 2 by the authors Spiceland, Nelson, and Thomas.
If deferred asset is normally a credit balance when it is decreased from 30,000,000 to 28,000,000 wouldn't it be debited in the above journal entry instead of credited?
Ending Bal. = 70 Million x 40% | $ 28,000,000.00 |
Less: Beginning Bal. 75 mill x 40% | $ (30,000,000.00) |
Deferred Tax Assets | $ (2,000,000.00) |
When there is decrease in a deferred tax asset it would be credited | |
In this case deferred tax asset has reduced that’s why it will be credited. |
This is chapter 16 E-11 of Intermediate Accounting 2 by the authors Spiceland, Nelson, and Thomas....
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