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In its first year of operations, a firm produces taxable income of a negative ($15,000) a loss. The company has firm contracts in hand to

In its first year of operations, a firm produces taxable income of a negative ($15,000) a loss. The company has firm contracts in hand to provide assurance that the second year will be highly profitable. The prevailing tax rate is 20%. The firm's balance sheet will report a deferred tax:

asset of $15,000

liability of $3,000

asset of $3,000

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