PROBLEMS/DISCUSSION QUESTIONS Moss Inc. follows GAAP for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. It reported $250,000 of pre-tax income under GAAP, but it will report the corresponding taxable income in the following years. The enacted tax rate is 21%. P14-1 Calculating deferred tax amounts (LO 14-2, LO 14-4) AICPA ADAPTED The installment income is the firm's only temporary difference. Required: What amount should be included as the deferred tax liability in Moss's December 31, 20X1, balance sheet? 20X1 20X2 20X4 Taxable Income $ 25,000 50,000 75,000 100,000
PROBLEMS/DISCUSSION QUESTIONS Moss Inc. follows GAAP for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. It reported $250,000 of pre-tax income under GAAP, but it will report the corresponding taxable income in the following years. The enacted tax rate is 21%. P14-1 Calculating deferred tax amounts (LO 14-2, LO 14-4) AICPA ADAPTED The installment income is the firm's only temporary difference. Required: What amount should be included as the deferred tax liability in Moss's December 31, 20X1, balance sheet? 20X1 20X2 20X4 Taxable Income $ 25,000 50,000 75,000 100,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:PROBLEMS/DISCUSSION QUESTIONS
Moss Inc. follows GAAP for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. It reported $250,000 of pre-tax income under GAAP, but it will report the corresponding taxable income in the following years. The enacted tax rate is 21%.
P14-1
Calculating deferred tax amounts (LO 14-2, LO 14-4)
AICPA
ADAPTED
The installment income is the firm's only temporary difference.
Required:
What amount should be included as the deferred tax liability in Moss's December 31, 20X1, balance sheet?
20X1
20X2
20X3
20X4
Taxable Income
$ 25,000
50,000
75,000
100,000
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