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Zygote Ltd, recorded warranty expense of $125,000 in 20X6. $35.000 in 20x7. and $75,000 in 20X8. Warranty claims paid were $70,000 in 20X6, $55,000 in
Zygote Ltd, recorded warranty expense of $125,000 in 20X6. $35.000 in 20x7. and $75,000 in 20X8. Warranty claims paid were $70,000 in 20X6, $55,000 in 20X7, and $90,000 in 20X8. Warranty amounts are tax deductible when the cash is paid. Zygote's income tax rate is 28% Required: For each 31 December 20X6 through 20x8, determine: (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign. Leave no cells blank - be certain to enter"0" wherever required.) 1. The tax basis for the warranty liability 2. The accounting basis for the warranty liability. 3. The cumulative amount of the temporary difference relating to the warranty liability. 4. The balance of deferred income tax asset or liability that would be reported on the statement of financial position. (Round your answer to 2 decimal places.) 5. The amount of the deferred income tax adjustment. (Round your answer to 2 decimal places.) Zygote Ltd. recorded warranty expense of $125,000 in 20X6, $35,000 in 20X7, and $75,000 in 20X8. Warranty claims paid were $70,000 in 20X6, $55,000 in 20X7, and $90,000 in 20X8. Warranty amounts are tax deductible when the cash is paid. Zygote's income tax rate is 28%. Required: For each 31 December 20X6 through 20X8, determine: (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign. Leave no cells blank - be certain to enter "0" wherever required.) 1. The tax basis for the warranty liability. 2026 2027 2028 Tax basis 2. The accounting basis for the warranty liability. 20x620x720X8 Accounting basis 3. The cumulative amount of the temporary difference relating to the warranty liability. 2026 2027 2028 Temporary difference 4. The balance of deferred income tax asset or liability that would be reported on the statement of financial position. (Round your answer to 2 decimal places.) 20x6 2027 2028 Deferred income tax balance 5. The amount of the deferred income tax adjustment. (Round your answer to 2 decimal places.)
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