PT ABC has a deferred tax asset account with a balance of Rp300.000 at the end of 2018 due to a single cumulative temporary difference of Rp750.000. At the end of 2019, this same temporary difference has increased to a cumulative amount of Rp1.000.000. Taxable income for 2019 is Rp1.700.000. The tax rate is 40% for all years. Assuming it's probable that 70% of the deferred tax asset will be realized, what amount will be reported on ABC's statement of financial position for the deferred tax asset at December 31, 2019? * Rp680.000 O Rp400.000 O Rp280.000 Rp700.000

PT ABC has a deferred tax asset account with a balance of Rp300.000 at the end of 2018 due to a single cumulative temporary difference of Rp750.000. At the end of 2019, this same temporary difference has increased to a cumulative amount of Rp1.000.000. Taxable income for 2019 is Rp1.700.000. The tax rate is 40% for all years. Assuming it's probable that 70% of the deferred tax asset will be realized, what amount will be reported on ABC's statement of financial position for the deferred tax asset at December 31, 2019? * Rp680.000 O Rp400.000 O Rp280.000 Rp700.000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

PT ABC has a deferred tax asset account with a balance of Rp300.000 at
the end of 2018 due to a single cumulative temporary difference of
Rp750.000. At the end of 2019, this same temporary difference has
increased to a cumulative amount of Rp1.000.000. Taxable income for 2019
is Rp1.700.000. The tax rate is 40% for all years. Assuming it's probable that
70% of the deferred tax asset will be realized, what amount will be
reported on ABC's statement of financial position for the deferred tax asset
at December 31, 2019? *
Rp680.000
O Rp400.000
O Rp280.000
O Rp700.000

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