Summer Co is preparing the reconciliation between accounting income and taxable income for 2019 Actual warranty repairs made in 2019 and allowed to be deducted for tax purposes amounted to $40,000 Warranty expense recorded in 2019 was $30,000 For years before 2019, warranty expense recorded was $60,000 and total repairs made under warranty amounted to $10,000 CCA allowed for tax purposes in 2019 was $65,000 depreciation expense recorded in 2019 was $85,000 For years before 2019, depreciation expense exceeded CCA by $70,000 The rate for all years is 30 QUESTION How much is the total deferred tax expense for 2019 Select one a $3,000 debit b $3,000 credit c $9,000 credit d $9,000 debit e none of the above Summer Co is preparing the reconciliation between accounting income and taxable income for 2019 Actual warranty repairs made in 2019 and allowed to be deducted for tax purposes amounted to $40,000 Warranty expense recorded in 2019 was $30,000 For years before 2019, warranty expense recorded was $60,000 and total repairs made under warranty amounted to $10,000 CCA allowed for tax purposes in 2019 was $65,000 depreciation expense recorded in 2019 was $85,000 For years before 2019, depreciation expense exceeded CCA by $70,000 The rate for all years is 30 QUESTION How much is the total deferred tax amount on the December 31, 2019 balance sheet Select one a $15,000 asset b $15,000 liability c $39,000 asset d $39,000 liability e none of the above

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 03, 2024

Summer Co. is preparing the reconciliation between accounting income and taxable income for 2019.
Actual warranty repairs made in 2019 and allowed to be deducted for tax purposes amounted to $40,000. Warranty expense recorded in 2019 was $30,000.
For years before 2019, warranty expense recorded was $60,000 and total repairs made under warranty amounted to $10,000.
CCA allowed for tax purposes in 2019 was $65,000; depreciation expense recorded in 2019 was $85,000.
For years before 2019, depreciation expense exceeded CCA by $70,000.
The rate for all years is 30%

QUESTION

How much is the total deferred tax expense for 2019?

Select one:

a. $3,000 debit

b. $3,000 credit

c. $9,000 credit

d. $9,000 debit

e. none of the above

Summer Co. is preparing the reconciliation between accounting income and taxable income for 2019.
Actual warranty repairs made in 2019 and allowed to be deducted for tax purposes amounted to $40,000. Warranty expense recorded in 2019 was $30,000.
For years before 2019, warranty expense recorded was $60,000 and total repairs made under warranty amounted to $10,000.
CCA allowed for tax purposes in 2019 was $65,000; depreciation expense recorded in 2019 was $85,000.
For years before 2019, depreciation expense exceeded CCA by $70,000.
The rate for all years is 30%

QUESTION

How much is the total deferred tax amount on the December 31, 2019 balance sheet?

Select one:

a. $15,000 asset

b. $15,000 liability

c. $39,000 asset

d. $39,000 liability

e. none of the above