Question
At December 31, DePaul Corporation had a $16 million balance in its deferred tax asset account and a $156 million balance in its deferred tax
At December 31, DePaul Corporation had a $16 million balance in its deferred tax asset account and a $156 million balance in its deferred tax liability account. The balances were due to the following cumulative temporary differences: |
1. | Estimated warranty expense, $15 million: expense recorded in the year of the sale; tax-deductible when paid (one-year warranty). |
2. | Depreciation expense, $240 million: straight-line in the income statement; MACRS on the tax return. |
3. | Income from installment sales of properties, $150 million: income recorded in the year of the sale; taxable when received equally over the next five years. |
4. | Rent revenue collected in advance, $25 million; taxable in the year collected; recorded as income when earned the following year. |
Required: |
Determine the deferred tax amounts to be reported in the December 31 balance sheet. The tax rate is 40%.(Enter your answers in millions.) |
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