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Question 3 3 pts Company A uses straight-line depreciation for financial reporting purposes for equipment costing $550 with an expected useful life of five years
Question 3 3 pts Company A uses straight-line depreciation for financial reporting purposes for equipment costing $550 with an expected useful life of five years and no residual value. Assume that, for tax purses, the deduction is 50%, 20%, 10%, 10%, 10% in those years. Pretax accounting income the first year the equipment was used was $850, which includes interest revenue of $30 from municipal governmental bonds. Other than the two described, there are no differences between accounting income and taxable income. The enacted tax rate is 20%. Which of the following are included in the journal entry to record income taxes? Debit to deferred tax asset for $165 Debit to income tax expense for $131 Debit to income tax expense for $164 Credit to deferred tax liability for $165
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