On December 31, 2022, Big Bear Corporation reports liabilities with a tax basis of $1,200,000 and a book basis of $1,700,000. There was no difference in the asset basis. The difference in liability basis arose from temporary differences that would reverse in the following years: 2023 $120,000 2024 $110,000 2025 $112,000 2026 $80,000 2027 $78,000 Assuming a tax rate of 40% for 2022 - 2025 and a rate of 45% for 2026 - 2027, what should Big Bear report on its balance sheet on December 31, 2022? Group of answer choices deferred tax liability of $200,000 deferred tax asset of $207,900 deferred tax liability of $207,900 deferred tax asset of $200,000
On December 31, 2022, Big Bear Corporation reports liabilities with a tax basis of $1,200,000 and a book basis of $1,700,000. There was no difference in the asset basis. The difference in liability basis arose from temporary differences that would reverse in the following years: 2023 $120,000 2024 $110,000 2025 $112,000 2026 $80,000 2027 $78,000 Assuming a tax rate of 40% for 2022 - 2025 and a rate of 45% for 2026 - 2027, what should Big Bear report on its balance sheet on December 31, 2022? Group of answer choices deferred tax liability of $200,000 deferred tax asset of $207,900 deferred tax liability of $207,900 deferred tax asset of $200,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On December 31, 2022, Big Bear Corporation reports liabilities with a tax basis of $1,200,000 and a book basis of $1,700,000. There was no difference in the asset basis. The difference in liability basis arose from temporary differences that would reverse in the following years:
Assuming a tax rate of 40% for 2022 - 2025 and a rate of 45% for 2026 - 2027, what should Big Bear report on its balance sheet on December 31, 2022?
| 2023 | $120,000 |
| 2024 | $110,000 |
| 2025 | $112,000 |
| 2026 | $80,000 |
| 2027 | $78,000 |
Group of answer choices
deferred tax liability of $200,000
deferred tax asset of $207,900
deferred tax liability of $207,900
deferred tax asset of $200,000
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