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For the current year ($ in millions), Chicago Corporation had $148 in pretax accounting income. This included warranty expense of $9 and $18 in depreciation expense. $8 million of warranty costs were incurred, and depreciation deductions in the tax return amounted to $41. In the absence of other temporary or permanent differences, what was Chicago's income tax payable currently, assuming a tax rate of 25%? Multiple Choice $25.7 million $31.5 million $28.4 million $44.8 million

For the current year ($ in millions), Chicago Corporation had $148 in pretax accounting income. This included warranty expense of $9 and $18 in depreciation expense. $8 million of warranty costs were incurred, and depreciation deductions in the tax return amounted to $41. In the absence of other temporary or permanent differences, what was Chicago's income tax payable currently, assuming a tax rate of 25%? Multiple Choice $25.7 million $31.5 million $28.4 million $44.8 million

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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For the current year ($ in millions), Chicago Corporation had $148 in pretax accounting income. This included warranty expense of $9 and $18 in depreciation expense. $8 million of warranty costs were incurred, and depreciation deductions in the tax return amounted to $41. In the absence of other temporary or permanent differences, what was Chicago's income tax payable currently, assuming a tax rate of 25%? Multiple Choice $25.7 million $31.5 million $28.4 million $44.8 million
Transcribed Image Text:For the current year ($ in millions), Chicago Corporation had $148 in pretax accounting income. This included warranty expense of $9 and $18 in depreciation expense. $8 million of warranty costs were incurred, and depreciation deductions in the tax return amounted to $41. In the absence of other temporary or permanent differences, what was Chicago's income tax payable currently, assuming a tax rate of 25%? Multiple Choice $25.7 million $31.5 million $28.4 million $44.8 million
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