Financial Accounting Crayon Industries has a taxable income of $1,800,000 and a pre-tax accounting income of$1,650,000 in the current accounting period. Assuming a tax rate of 30%, what is the taxliability that appears on the balance sheet for this year?A. $495,000B. $540,000C. $150,000D. $45,000

Step 1: Define Tax LiabilityTax liability refers to the total amount of tax a company owes to the…

Answered: Crayon Industries has a taxable income…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter2: The Domestic And International Financial Marketplace

Section2.A: Taxes

Problem 3P

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Crayon Industries has a taxable income of $1,800,000 and a pre-tax accounting income of $1,650,000 in the current accounting period. Assuming a tax rate of 30%, what is the tax liability that appears on the balance sheet for this year? A. $495,000 B. $540,000 C. $150,000 D. $45,000