F5 - Income Taxes Flashcards

1
Q

Pre-tax financial income

200,000

Excess depreciation per tax return

(40,000)

Municipal bond interest

(10,000)

Taxable income

=150,000

If the enacted tax rate for current and future periods were 25%, Rubarb would record a deferred tax liability of:

A

Temporary difference is the 40K of deprecetiaion so multiply by the % to find the $10K that is deferred liability

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