Cardinal Corporation reported pretax book income of $3.300.000 During the curent year, the reserve for bad debts increased by $100.000. In addition, tax depreciation exceeded book depreciation by $200,000. Cardinal sold a foxed asset and reported a book gain of $10,000 and tax gain of $45,000. Cardinal had a net deferred tax asset of $12,600 at the beginning of the year. representing a balance of $60,000 of net temporary unfavorable differences a. Compute Cardinal's current income tax expense or benefit. b. Compute Cardinal's deferred income tax expense or benefit.
Cardinal Corporation reported pretax book income of $3.300.000 During the curent year, the reserve for bad debts increased by $100.000. In addition, tax depreciation exceeded book depreciation by $200,000. Cardinal sold a foxed asset and reported a book gain of $10,000 and tax gain of $45,000. Cardinal had a net deferred tax asset of $12,600 at the beginning of the year. representing a balance of $60,000 of net temporary unfavorable differences a. Compute Cardinal's current income tax expense or benefit. b. Compute Cardinal's deferred income tax expense or benefit.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Q.11.
Transcribed Image Text:Cardinal Corporation reported pretax book income of $3.300.000 During the curent year, the
reserve for bad debts increased by $100,000. In addition, tax depreciation exceeded book
depreciation by $200,000. Cardinal sold a foxed asset and reported a book gain of $10,000 and
gain of $45,000. Cardinal had a net deferred tax asset of $12.600 at the beginning of the year.
representing a balance of $60,000 of net temporary unfavorable differences
a. Compute Cardinal's current income tax expense or benefit.
b. Compute Cardinal's deferred income tax expense or benefit.
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