Question

Total liabilities and stockholders' equity ($332,500) ($410,500) The partial beginning of the year tax and book balance sheet information is provided below. Complete the table and determine the Relix's deferred tax benefit or expense for the year. Assume a 21% Federal corporate tax rate and no valuation allowance. Net Book Value Tax Adjusted Basis Temporary Difference Combined Tax Rate Deferred Tax Asset/(Liability) Accumulated depreciation-Building $360,000 $417,000 57,000 21% $ 11,970 Accumulated depreciation -- Furniture & fixtures 31,000 35,200 4,200 21% 882 Accrued litigation expense 34,000 0 34,000 ✓ 21% 7,140 Net deferred tax liability $ 5,712 → Provide the journal entry necessary to record this amount. JOURNAL DATE Description Post. Ref. Debit Credit Income tax expense (provision) 7,140 x Deferred tax liability 7,140 x Feedback Check My Work The total book tax expense under ASC 740 (SFAS 109) is made up of both current and deferred components. The current tax expense theoretically represents the taxes actually payable to (or refund receivable from the governmental authorities for the current period. The deferred component of the book tax expense is called the deferred tax expense or deferred tax benefit. This component represents the future tax cost (or savings) connected with income reported in the current-period financial statement. check My Work Omore Check My Work uses remaining.

Answer 1

Total deferred tax liability is USD 5,712. so this amount only you have to consider while passing entry. here you have considered 7,140 which is wrong