A company has Taxable Income of $70,000 and Pre-tax Income of $80,000 during fiscal year 2012. The statutory tax rate is 35.0% and the effective tax rate is 30% What is Income Tax Payable for 2012? $24,500 $28,000 $10,000 $24,000 $21,000 O O O O O

A company has Taxable Income of $70,000 and Pre-tax Income of $80,000 during fiscal year 2012. The statutory tax rate is 35.0% and the effective tax rate is 30% What is Income Tax Payable for 2012? $24,500 $28,000 $10,000 $24,000 $21,000 O O O O O

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

A company has Taxable Income of $70,000
and Pre-tax Income of $80,000 during fiscal
year 2012. The statutory tax rate is 35.0%
and the effective tax rate is 30%
What is Income Tax Payable for 2012?
$24,500
$28,000
$10,000
$24,000
$21,000

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