Li Corporation reported pretax book income of $660,000. Tax depreciation exceeded book depreciation by $412,000. Li's beginning book (tax) basis in its fixed assets was $1,960,000 ($1,748,000) and its ending book (tax) basis is $1,860,000 ($1,272,000). In addition, the company received $360,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $49,000. Assuming a tax rate of 21 percent, compute the company's deferred income tax expense or benefit. Note: Enter all numbers as a positive number and indicate whether a deferred tax expense or a deferred tax benefit. Answer is complete but not entirely correct. Deferred income tax expense $ 65,520

Li Corporation reported pretax book income of $660,000. Tax depreciation exceeded book depreciation by $412,000. Li's beginning book (tax) basis in its fixed assets was $1,960,000 ($1,748,000) and its ending book (tax) basis is $1,860,000 ($1,272,000). In addition, the company received $360,000 of tax-exempt municipal bond interest. The company's prior-year tax return showed taxable income of $49,000. Assuming a tax rate of 21 percent, compute the company's deferred income tax expense or benefit. Note: Enter all numbers as a positive number and indicate whether a deferred tax expense or a deferred tax benefit. Answer is complete but not entirely correct. Deferred income tax expense $ 65,520

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 2P

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