Income tax liability for temporary difference

Reference no: EM13138176

Purchased a machine for $720,000 which will be depreciated $72,000 per year for financial statement reporting purposes. For income tax reporting, Gore elected to expense $80,000 and to use straight-line depreciation which will allow a cost recovery deduction of $64,000 for 2011. Assume a present and future enacted income tax rate of 30%. What amount should be added to Gore's deferred income tax liability for this temporary difference.

Reference no: EM13138176

Questions Cloud

Administrative expenses and operating income : No additional fixed manufacturing overhead will be incurred because of this order. The only additional selling expense on this order will be a $0.50 per unit shipping cost. There will be no additional administrative expenses because of this order...

Transactions involving notes payable : Alhara Corporation, whose fiscal year ended June 30, 20xx, completed the following transactions involving notes payable:

Determine the due date and the amount of interest : Determine the due date and the amount of interest due at maturity on the following notes: Oct. 1 fee amount 10,500, interest rate 8%, and term of the note is 60 days, Aug. 30 18,000, 10%,120 days, May 30., 12,000, 12%, 90 days, March 6, 15,000, 9%..

Bonds payable affected by the amortization : How would the carrying value of bonds payable be affected by the amortization of each of the following?

Income tax liability for temporary difference : Assume a present and future enacted income tax rate of 30%. What amount should be added to Gore's deferred income tax liability for this temporary difference.

Dates of the debt reduction : The mortgage holder on the vacation home agreed to reduce the mortgage from $60,000 to $50,000. The value of the personal residence was $80,000 and the value of the vacation home was $45,000 at the dates of the debt reduction.

Costs of rent and utilities : Imagine a invester has increased your budget by $22,500. The investor does not need to be repaid. Rather, he becomes part owner of your business. Will the investor contribute enough money to meet the costs of rent and utilities? Support your answe..

Basics of cash flows from financing activities : Which of the following would be included in cash flows from financing activities?

Cash inflow from investing activities : How many of the above items will appear as a cash inflow from investing activities on a statement of cash flows for the current year?

User Account

All Pages