At December 31, 20X4, Bren Co. had the following deferred income tax items: Which of the following should Bren report as the noncurrent item(s) on its December 31, 20X4 balance sheet?

Select one:

a. $12,000 net Liability

b. $15,000 Asset, $3,000 Liability

c. $11,000 net Asset

d. $4,000 net Liability

e. $3,000 net Liability

2. The Palms company records a Deferred Tax Asset; it is likely that the DTA will not be realized due to doubtful future incomes. Palms properly records an Allowance account. Recording the allowance will increase

Select one:

a. Income Tax Expense

b. Income Tax Payable

c. Deferred Tax Liability

d. Benefit due to Loss Carry forward

3. Lease X contains no bargain purchase option, but the lease term is equal to 70% of the estimated economic life of the leased property. Lease Y does not transfer ownership of the property to the lessee at the end of the lease term, but the present value of the lease payments is equal to 95% of the fair value of the leased property. How should the lessee classify Lease X and Lease Y, respectively?

Select one:

a. Operating Lease, Capital Lease

b. Capital Lease, Operating Lease

c. Both are Operating Leases

d. Both are Capital Leases

A deferred income tax liability of $15,000 related to a noncurrent asset A deferred income tax asset of $3,000 related to a noncurrent liability A deferred income tax asset of $8,000 related to a current liability