South, Inc., earns book net income before tax of $400,000 in year 1. It acquires a depreciable asset in year 1, and its first-year tax depreciation exceeds book depreciation by $50,000. In year 2, South earns $500,000 book net income before tax, and its book depreciation exceeds tax depreciation by $20,000. South records no other temporary or permanent book - tax differences. Assuming that the applicable tax rate is 21 %, what is South's total provision for income tax expense reported on its GAAP financial statements for year 2? a. $105, 000 b. $4,200 c. $94,500 d. $109, 200

South, Inc., earns book net income before tax of $400,000 in year 1. It acquires a depreciable asset in year 1, and its first-year tax depreciation exceeds book depreciation by $50,000. In year 2, South earns $500,000 book net income before tax, and its book depreciation exceeds tax depreciation by $20,000. South records no other temporary or permanent book - tax differences. Assuming that the applicable tax rate is 21 %, what is South's total provision for income tax expense reported on its GAAP financial statements for year 2? a. $105, 000 b. $4,200 c. $94,500 d. $109, 200

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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