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Noble Incorporated paid $310,000 for equipment three years ago. This year, it sold the equipment for $200,000. Through date of sale, accumulated book depreciation was $93,840 and accumulated tax depreciation was $147,327. Assuming a 21% tax rate, what is the effect of the sale on Noble's deferred tax accounts? Multiple Choice $11,232 increase in deferred tax assets $11,232 increase in deferred tax liabilities $11.232 decrease in deferred tax Sabilities No effect on deferred tax accounts

Noble Incorporated paid $310,000 for equipment three years ago. This year, it sold the equipment for $200,000. Through date of sale, accumulated book depreciation was $93,840 and accumulated tax depreciation was $147,327. Assuming a 21% tax rate, what is the effect of the sale on Noble's deferred tax accounts? Multiple Choice $11,232 increase in deferred tax assets $11,232 increase in deferred tax liabilities $11.232 decrease in deferred tax Sabilities No effect on deferred tax accounts

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Noble Incorporated paid $310,000 for equipment three years ago. This year, it sold the equipment for $200,000. Through date of sale, accumulated book depreciation was $93,840 and accumulated tax depreciation was $147,327. Assuming a 21% tax rate, what is the effect of the sale on Noble's deferred tax accounts? Multiple Choice $11,232 increase in deferred tax assets $11,232 increase in deferred tax liabilities $11.232 decrease in deferred tax labilities No effect on deferred tax accounts
Transcribed Image Text:Noble Incorporated paid $310,000 for equipment three years ago. This year, it sold the equipment for $200,000. Through date of sale, accumulated book depreciation was $93,840 and accumulated tax depreciation was $147,327. Assuming a 21% tax rate, what is the effect of the sale on Noble's deferred tax accounts? Multiple Choice $11,232 increase in deferred tax assets $11,232 increase in deferred tax liabilities $11.232 decrease in deferred tax labilities No effect on deferred tax accounts
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