Question
Plane Corp. reported the following on its December 31, 2014 balance sheet (amounts are in $): Property, Plant and Equipment: 16,000,000Patent: 6,000,000Inventory: 12,000,000Trade Receivables: 20,000,000Trade
Plane Corp. reported the following on its December 31, 2014 balance sheet (amounts are in $): Property, Plant and Equipment: 16,000,000Patent: 6,000,000Inventory: 12,000,000Trade Receivables: 20,000,000Trade Payables: 24,000,000Cash: 8,000,000 For tax purposes, the following information is used: Tax base of property, plant and equipment, and patent was $12,000,000 and $4,000,000, respectively.Provision for inventory loss due to obsolescence for $2,000,000 is not allowable for tax purposes.Impairment loss against receivables of $4,000,000 has been made. This charge will not be allowed in the current year for tax purposes.The tax rate is 30%. What amount should be recognized as deferred tax expense 2014?
Group of answer choices
a. $3,600,000
b. $0
c. $2,400,000
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