Question
In: Accounting
Information for questions 8. and 9. Paige Company deducts insurance expense of $105,000 for tax purposes...
Information for questions 8. and 9. Paige Company deducts
insurance expense of $105,000 for tax
purposes in 2018, but the expense is not yet recognized for
accounting purposes. In 2019,
2020, and 2021, no insurance expense will be deducted for tax
purposes, but $35,000 of
insurance expense will be reported for accounting purposes in each
of these years. Paige
Company has a tax rate of 40% and income taxes payable of $90,000
at the end of 2018.
There were no deferred taxes at the beginning of 2018.
8. What is the amount of the deferred tax liability at the end
of 2018?
a. $42,000
b. $36,000
c. $15,000
d. $0
9. What is the amount of income tax expense for 2018?
a. $132,000
b. $126,000
c. $105,000
d. $90,000
Solutions
Expert Solution
8. The amount of the deferred tax liability at the end of 2018:
105000*0.4 = 42000
Answer - a. $42,000
9. The amount of income tax expense for 2018:
42000 + 90000 = $132,000
Answer - a. $132,000
ekkarill92 answered 2 years agoRelated Solutions
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to its 2014 financial report.
Year ended December 31
2014
2013
2012
Current tax expense
U.S. federal
$775
$-84
$756
Non-U.S.
93
78
63
U.S. state
71
13
21
939
7
831
Deferred tax expense
U.S. federal
927
1,630
1,308
Non-U.S
36
43
(15)
U.S state
(7)
71
85
956
1,744
1,378
Total income tax expense
$1,895
$1,751
$2,209
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Recording Income Tax Expense The Boeing Company reports the following tax information in Note 4 to...
Recording Income Tax Expense
The Boeing Company reports the following tax information in Note 4
to its 2014 financial report.
Year ended December 31
2014
2013
2012
Current tax expense
U.S. federal
$775
$-84
$756
Non-U.S.
93
78
63
U.S. state
71
13
21
939
7
831
Deferred tax expense
U.S. federal
927
1,630
1,308
Non-U.S
36
43
(15)
U.S state
(7)
71
85
956
1,744
1,378
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$1,895
$1,751
$2,209
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