Question
In 2012, Krause Company accrued, for financial statement reporting, estimated losses on disposal of unused plant facilities of $1,800,000. The facilities were sold in March
In 2012, Krause Company accrued, for financial statement reporting, estimated losses on disposal of unused plant facilities of $1,800,000. The facilities were sold in March 2013 and a $1,800,000 loss was recognized for tax purposes. Also in 2012, Krause paid $100,000 in premiums for a two-year life insurance policy in which the company was the beneficiary. Assuming that the enacted tax rate is 30% in both 2012 and 2013, and that Krause paid $780,000 in income taxes in 2012, the amount reported as net deferred income taxes on Krause's balance sheet at December 31, 2012, should be a
a.$510,000 asset.b.$270,000 asset.c.$270,000 liability.d.$540,000 asset.
Hi, could you show me how to get the answer d? Why asset? Why we use 1800000x30%?
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