Isaac Incorporated began operations in January 2024. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2024, Isaac had $655 million in sales of this type. Scheduled collections for these sales are as follows: 2024 2025 2026 2027 2028 $ 64 million 124 million 140 million 155 million 172 million $ 655 million Assume that Isaac has a 30% income tax rate and that there were no other differences in income for financial statement and tax purposes. Suppose that, in 2025, legislation revised the income tax rates so that Isaac would be taxed in 2026 and beyond at 25%, rather than 30%. Assume that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses and additional sales in 2025, what deferred tax liability would Isaac report in its year-end 2025 balance sheet? Note: Round your answer to the nearest whole million.

Isaac Incorporated began operations in January 2024. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2024, Isaac had $655 million in sales of this type. Scheduled collections for these sales are as follows: 2024 2025 2026 2027 2028 $ 64 million 124 million 140 million 155 million 172 million $ 655 million Assume that Isaac has a 30% income tax rate and that there were no other differences in income for financial statement and tax purposes. Suppose that, in 2025, legislation revised the income tax rates so that Isaac would be taxed in 2026 and beyond at 25%, rather than 30%. Assume that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses and additional sales in 2025, what deferred tax liability would Isaac report in its year-end 2025 balance sheet? Note: Round your answer to the nearest whole million.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 47P

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Isaac Incorporated began operations in January 2024. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2024, Isaac had $642 million in sales of this type. Scheduled collections for these sales are as follows: 2024 $71 million 2025 129 million 2026 123 million 2027 157 million 2028 162 million $ 642 million Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses, what deferred tax liability would Isaac report in its year - end 2024 balance sheet?
Isaac Inc. began operations in January 2021. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2021, Isaac had $676 million in sales of this type. Scheduled collections for these sales are as follows: 2021 $ 83 million 2022 137 million 2023 129 million 2024 162 million 2025 165 million $ 676 million Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses, what deferred tax liability would Isaac report in its year-end 2021 balance sheet?
Isaac Inc. began operations in January 2021. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments.In 2021, Isaac had $600 million in sales of this type. Scheduled collections for these sales are as follows: 2021 $ 60 million 2022 120 million 2023 120 million 2024 150 million 2025 150 million $ 600 million Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses and additional sales in 2022, what deferred tax liability would Isaac report in its year-end 2022 balance sheet?
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