Stanley Corporation is a calendar year, accrual-basis C corporation, and it follows GAAP for book purposes....

 

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Stanley Corporation is a calendar year, accrual-basis C corporation, and it follows GAAP for book purposes. In 2023, it reported pretax book income of $400,000. Tax depreciation exceeded book depreciation by $100,000. In addition, the corporation incurred business entertainment expense of $12,000. Stanley has a net operating loss carryforward of $60,000 from 2017. The corporate tax rate is 21% and is expected to be 21% in future years. Stanley's beginning deferred tax accounts include: (1) a deferred tax asset balance of $12,600 as a result of the NOL carryforward from 2017; (2) a deferred tax liability balance of $63,000 as a result of cumulative tax depreciation exceeding cumulative book depreciation by $300,000 as of the beginning of 2023. (a) What is Stanley's current tax expense in 2023? (b) What is Stanley's deferred tax expense in 2023? Stanley Corporation is a calendar year, accrual-basis C corporation, and it follows GAAP for book purposes. In 2023, it reported pretax book income of $400,000. Tax depreciation exceeded book depreciation by $100,000. In addition, the corporation incurred business entertainment expense of $12,000. Stanley has a net operating loss carryforward of $60,000 from 2017. The corporate tax rate is 21% and is expected to be 21% in future years. Stanley's beginning deferred tax accounts include: (1) a deferred tax asset balance of $12,600 as a result of the NOL carryforward from 2017; (2) a deferred tax liability balance of $63,000 as a result of cumulative tax depreciation exceeding cumulative book depreciation by $300,000 as of the beginning of 2023. (a) What is Stanley's current tax expense in 2023? (b) What is Stanley's deferred tax expense in 2023?

Answer rating: 100% (QA)

a Current Tax Expense Taxable Income Pretax Book Income 400000 Taxable Depreciation Difference 10000... View the full answer