Question
Robinson Company had a net deferred tax liability of $34,136 at the beginning of the year, representing a net taxable temporary difference of $100,400 (taxed
Robinson Company had a net deferred tax liability of $34,136 at the beginning of the year, representing a net taxable temporary difference of $100,400 (taxed at 34%). During the year, Robinson reported pretax book income of $400,400. Included in the computation were favorable temporary differences of $50,400 and unfavorable temporary differences of $20,200. During the year, Congress reduced the corporate tax rate from 34% to 21%. Robinson's deferred income tax expense or benefit for the current year would be:
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Net deferred tax benefit of $6,342.
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Net deferred tax expense of $6,342.
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Net deferred tax benefit of $6,710.
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Net deferred tax expense of $6,710.
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