Question
As of the end of 2022, Elliott had a deferred tax asset of $100,000 and believed it was not more likely than not that it
As of the end of 2022, Elliott had a deferred tax asset of $100,000 and believed it was not more likely than not that it could realize any of the tax deductions associated with the deferred tax asset. As of the end of 2023, Elliott needed to show a deferred tax asset of $150,000, and believed it was more likely than not that it would realize $20,000 of that deferred tax asset. Assuming tax payable of $300,000 and no deferred tax liabilities, Elliotts 2023 tax expense journal entry includes a:
Debit to tax expense for $330,000
Debit to tax expense for $280,000
Debit to tax expense for $250,000
Credit to tax expense for $230,000
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