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Mordor Corp. reported the following information at the end of 2021, its first year of operations: Item Amount Pretax financial income $524,000 Estimated warranty expense
Mordor Corp. reported the following information at the end of 2021, its first year of operations:
Item | Amount |
---|---|
Pretax financial income | $524,000 |
Estimated warranty expense | $93,000 |
Income tax rate for all years | 22% |
The estimated warranty expense will be deductible in 2022 when it is expected to be paid. At the end of 2021, which of the following deferred tax accounts and balances should be reported on Mordor Corp.s balance sheet?
Deferred tax liability: $20,460
Deferred tax asset: $93,000
Deferred tax asset: $20,460
Deferred tax liability: $93,000
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