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Blossom, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment
Blossom, Inc. uses the accrual method of accounting for financial reporting purposes and appropriately uses the installment method of accounting for income tax purposes. Installment income of $ 2900000 will be collected in the following years when the enacted tax rates are:
Collection of Income | Enacted Tax Rates | |
2020 | $ 280000 | 25% |
2021 | 580000 | 20% |
2022 | 882000 | 20% |
2023 | 1158000 | 15% |
The installment income is Blossom's only temporary difference. What amount should be included in the deferred income tax liability in Blossom's December 31, 2020 balance sheet?
$ 568100
$ 725000
$ 655000
$ 466100
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