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KRJ Corporation reported (in $ millions) tax expense of $950 for the year. Taxes payable at...

KRJ Corporation reported (in $ millions) tax expense of $950 for the year. Taxes payable at the beginning of the year was $150 and at the end of the year it was $153. Deferred taxes at the beginning of the year was $114 and at the end of the year it was $123. The company also reported deferred tax assets at the beginning of the year of $87 and at the end of the year it was $74. How much cash (in $ millions) was paid for taxes for during the year?

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Expert Solution

Calculation of Net deferred tax

Particulars Deferred Tax Assets Deferred Tax Liabilities Net DTL
Opening Balance $87 $114 $27
Closing Balance $74 $123 $49

Increase in deferred tax liability = $22

Calculation of taxes paid in cash

Opening tax payable $150
Add : Expense during the year -$950
Closing tax payable $153
Balance $947
Less : Increase in Deferred tax liability -$22
Taxes Paid during the year $925

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