Assignment 5
USE GAAP CODIFICATIONS
At December 31, 2017, Acme Inc. had the following deferred tax balances:
Deferred tax liability $ 62,500
Deferred tax asset 100,000
Valuation allowance 40,000
These deferred tax balances relate to two items. First, Acme has recorded excess tax deductions related to its plant assets. At December 31, 2017, plant assets had a book value of $1,000,000 and a tax basis of $750,000. Second, Acme had a NOL carryforward in the amount of $400,000 at December 31, 2017. Acme determined the appropriate tax rate for recording deferred taxes at December 31, 2017 was 25%.
At December 31, 2018, we have the following information related to Acme’s year-end tax accrual:
Required: Determine the following amounts:
a) Total deferred tax liability at December 31,2018
b) Total deferred tax asset at December 31, 2018
c) The presentation of deferred taxes on the December 31, 2018 balance sheet
d) The amount of income tax expense recognized in the Income Statement for year ended December 31, 2018
e) The total tax liability from the 2018 tax return
Assignment 5 USE GAAP CODIFICATIONS At December 31, 2017, Acme Inc. had the following deferred tax...
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