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HAL Corp.s deferred income tax liability account as at December 31, 2021, was $268,950 and was based on three temporary differences: The difference between the
HAL Corp.s deferred income tax liability account as at December 31, 2021, was $268,950 and was based on three temporary differences: The difference between the assets net book value of $6,580,000 and their undepreciated capital cost of $4,200,000 A warranty liability of $365,000 A loss carryforward of $1,200,000 Information for the December 31, 2022, year end is as follows: Net income before taxes $2,650,000 Depreciation expense $650,000 Capital cost allowance claim $875,000 One asset was disposed of for proceeds of $210,000; the assets net book value was $180,000, and the assets original cost was $300,000 Dividend revenue from taxable Canadian corporations $120,000 Meals and entertainment expenses $56,000 Warranty liability at the end of the year $420,000 Revenues reported for accounting purposes in 2022 include $250,000 that will be taxable in 2023 The tax rate in effect for 2022 was 35%. This rate was enacted in 2022. On December 31, 2022, the government enacted a tax rate of 36% for 2023. HAL Corp.s tax policy is to minimize taxable income
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