Ovate, Inc., earns $206,500 in book income before tax and is subject to a 21% marginal Federal income tax rate. Ovate records a single temporary difference. Warranty expenses deducted for book purposes are $31,200 of which only $7,800 are deductible for tax purposes. Ovate has a deferred tax asset of how much?

Ovate, Inc., earns $206,500 in book income before tax and is subject to a 21% marginal Federal income tax rate. Ovate records a single temporary difference. Warranty expenses deducted for book purposes are $31,200 of which only $7,800 are deductible for tax purposes. Ovate has a deferred tax asset of how much?

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 1P

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