Class Discussion No. 3 Please review the following information and explain the "total expense" for both companies. What can you get out of this breakdown of their total tax expense? What does it mean? Which company is better off? LawnCo Treeco Book income before tax $600,000 $780,000 Current tax expense $200,000 $ 20,000 Deferred tax expense (benefit) Total Federal, state, and global tax expense (50,000) 175,000 $195,000 $150,000 Effective tax rate 25% 25%
Class Discussion No. 3 Please review the following information and explain the "total expense" for both companies. What can you get out of this breakdown of their total tax expense? What does it mean? Which company is better off? LawnCo Treeco Book income before tax $600,000 $780,000 Current tax expense $200,000 $ 20,000 Deferred tax expense (benefit) Total Federal, state, and global tax expense (50,000) 175,000 $195,000 $150,000 Effective tax rate 25% 25%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Class Discussion No. 3
Please review the following information and explain the "total expense" for both companies. What can you get out of this breakdown of their total tax expense? What does it
mean? Which company is better off?
LawnCo
TreeCo
Book income before tax
$600,000
$780,000
Current tax expense
$200,000
$ 20,000
Deferred tax expense (benefit)
Total Federal, state, and global tax expense
(50,000)
$150,000
175,000
$195,000
Effective tax rate
25%
25%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5f21b3a3-c71c-4ddc-8218-cece0124510d%2F15d1182d-3db1-4157-9bd9-f8d2c7aabf4c%2F71luoml_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Class Discussion No. 3
Please review the following information and explain the "total expense" for both companies. What can you get out of this breakdown of their total tax expense? What does it
mean? Which company is better off?
LawnCo
TreeCo
Book income before tax
$600,000
$780,000
Current tax expense
$200,000
$ 20,000
Deferred tax expense (benefit)
Total Federal, state, and global tax expense
(50,000)
$150,000
175,000
$195,000
Effective tax rate
25%
25%
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