Question

1. Deferred tax liability, January 1, 2017, $44,400. 2. Deferred tax asset, January 1, 2017, $0. 3. Taxable income for 2017, $105,450. 4. Pretax financial income for 2017, $222,000. 5. Cumulative temporary difference at December 31, 2017, giving rise to future taxable amounts, $266,400. 6. Cumulative temporary difference at December 31, 2017, giving rise to future deductible amounts, $38,850. 7. Tax rate for all years, 40%. 8. The company is expected to operate profitably in the future. (a) Your answer is correct. Compute income taxes payable for 2017. (Round answer to the nearest dollar amount, e.g. $1,525.) Income taxes payable J 42180

Answer 1

Solution:

Marigold Corporation Income Statement (Partial) For the year ended 2017
Particulars		Amount
Income before taxes		$222,000.00
Income tax Expense:
Current tax	$42,180.00
Deferred taxes	$46,620.00
		$88,800.00
Net Income		$133,200.00