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a Labo Corp.'s Year 1 pretax income for financial reporting was $125,000, which included a $17,000 penalty for operating without a proper retail license and
a Labo Corp.'s Year 1 pretax income for financial reporting was $125,000, which included a $17,000 penalty for operating without a proper retail license and a $15,000 depreciation expense. MACRS depreciation on the tax return was $22,000. The enacted tax rates are 25% in Year 1 and 30% in future years. What amounts should Labo report as current and deferred tax liabilities on its Year 1 balance sheet? Current tax liability Deferred tax liability O A. $29,500 $1,750 B. $33,750 $2,100 C. $35,850 $2,100 D. $37,250 $1,750
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