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Robinson Company had a net deferred tax liability of $35,360 at the beginning of the year, representing a net taxable temporary difference of $104,000 (taxed
Robinson Company had a net deferred tax liability of $35,360 at the beginning of the year, representing a net taxable temporary difference of $104,000 (taxed at 34%). During the year, Robinson reported pretax book income of $404,000. Included in the computation were favorable temporary differences of $54,000 and unfavorable temporary differences of $22,000. 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: Multiple Choice Net deferred tax benefit of $6,720. Net deferred tax expense of $6,720 Net deferred tax benefit of $6,800 Net deferred tax expense of $6,800. Jones Company reported pretax book income of $414,000. Included in the computation were favorable temporary differences of $51,400, unfavorable temporary differences of $20,700, and favorable permanent differences of $40,700. Book equivalent of taxable income is: Multiple Choice $454,700. $414,000 $373,300. $341,900. Tuna Corporation reported pretax book income of $1,018,000. During the current year, the net reserve for warranties increased by $34,000. In addition, book depreciation exceeded tax depreciation by $118,000. Finally, Tuna subtracted a dividends received deduction of $24,000 in computing its current year taxable income. Book equivalent of taxable income is: Multiple Choice $1,170,000. $1,146,000. 1,042,000. $994,000
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