8. Huff Corp. began operations on January 1, 20x8. Huff recognizes revenues from all sales under the accrual method for financial reporting purposes and appropriately uses the installment method for income tax purposes. Huff's gross margin on installment sales under each method was as follows: Year Accrual method Installment method 20x8 P800,000 P300,000 20x9 1,300,000 700,000 Enacted income tax rates area 30% for 20x9 and 25% thereafter. There are no other temporary differences. In Huff's December 31, 20x9, balance sheet, the deferred income tax liability should be
8. Huff Corp. began operations on January 1, 20x8. Huff recognizes revenues from all sales under the accrual method for financial reporting purposes and appropriately uses the installment method for income tax purposes. Huff's gross margin on installment sales under each method was as follows: Year Accrual method Installment method 20x8 P800,000 P300,000 20x9 1,300,000 700,000 Enacted income tax rates area 30% for 20x9 and 25% thereafter. There are no other temporary differences. In Huff's December 31, 20x9, balance sheet, the deferred income tax liability should be
Chapter1: Financial Statements And Business Decisions
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Please put all of the necessary information and computations for better understanding. Thanks ?
Transcribed Image Text:8. Huff Corp. began operations on January 1, 20x8. Huff recognizes revenues from all sales
under the accrual method for financial reporting purposes and appropriately uses the
installment method for income tax purposes. Huff's gross margin on installment sales under
each method was as follows:
Year
Accrual method
Installment method
20x8
P800,000
P300,000
20x9
1,300,000
700,000
Enacted income tax rates area 30% for 20x9 and 25% thereafter. There are no other temporary
differences.
In Huff's December 31, 20x9, balance sheet, the deferred income tax liability should be
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