Question

Prance, Inc., earns pretax book net income of $1,141,000 in 2019. Prance acquires a depreciable asset that year, and first-year tax depreciation exceeds book depreciation by $114,100. Prance reported no other temporary or permanent book-tax differences. The pertinent U.S. Federal corporate income tax rate is 21%, and Prance earns an after-tax rate of return on capital of 8%. Enter below the Prance's 2019 deferred tax expense and any deferred tax asset or liability. If required, round your answer to nearest whole value. Balance Sheet Deferred tax liability 23,961 Income Statement Deferred tax expense Prance's total tax expense will consist of the following: Current tax expense Deferred tax expense Total tax expense

Answer 1

Balance Sheet
Deferred Tax liability	$ 23,961	=114100*21%
Income Statement
Deferred Tax Expense	$ 23,961	=114100*21%
Prance's Total tax expense will be
Current Tax expense	215,649	=(1141000-114100)*21%
Add :Deferred Tax Expense	23,961
Total Tax Expense	$ 239,610