30. LO.1, 4 Relix, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Based on this information, determine Relix’s Federal net deferred tax asset or net deferred tax liability at yearend.

Assume a 21% Federal corporate tax rate, no state or foreign taxes, and no need for a valuation allowance.

Tax Debit/

(Credit)

Book Debit/

(Credit)

Assets Cash $ 500 $ 500 Accounts receivable 8,000 8,000 Buildings 750,000 750,000 Accumulated depreciation (450,000) (380,000)

Furniture & fixtures 70,000 70,000 Accumulated depreciation (46,000) (38,000)

Total assets $332,500 $410,500 Tax Debit/

(Credit)

Book Debit/

(Credit)

Liabilities Accrued litigation expense $ –0– ($ 50,000)

Note payable (78,000) (78,000)

Total liabilities ($ 78,000) ($128,000)

Stockholders’ Equity Paid-in capital ($ 10,000) ($ 10,000)

Retained earnings (244,500) (272,500)

Total liabilities and stockholders’ equity ($332,500) ($410,500)