Indicate the manner in which deferred taxes should be

Reference no: EM13566265

At December 31, 2012, Cascade Company had a net deferred tax liability of $500,960. An explanation of the items that compose this balance is as follow.

Temporay Differences Balance in Deferred taxes

1. Excess of tax depreciation over book depreciation $232,100

2. Accrual, for book purposes, of estimated loss contingency

from pending lawsuit that is expected to be settled in 2013. The

loss will be deducted on the tax return when paid. (65,880)

3. Accrual method used for book purposes and installment method used for tax purposes for an isolated installment sale

of an investment. 334,740

Net deferred tax liability = $500,960

In analyzin the temporary differences, you find that $33,190 of the depreciation difference will reverse in 2013, and $115,250 of the temporary difference due to the installment sale will reverse in 2013. the tax rate for all years is 40%

Indicate the manner in which deferred taxes should be presented on Cascade Company's December 31, 2012, balance sheet.

Reference no: EM13566265

Questions Cloud

Calculate the missing amounts for each of the following : calculate the missing amounts for each of the following firms do not round your intermediate calculations. negative

When forecasting operating expenses explain the difference : when forecasting operating expenses explain the difference between a fixed cost and a variable

What is the yield-to-maturity of a 10-year 10 semi-annual : what is the yield-to-maturity of a 10-year 10 semi-annual coupon bond if its current price is 1135.90? assuming a 35

What reinvestment rate assumptions are built into the npv : what reinvestment rate assumptions are built into the npv irr and mirr methods? give an explanation other than

Indicate the manner in which deferred taxes should be : at december 31 2012 cascade company had a net deferred tax liability of 500960. an explanation of the items that

Currently new baa bonds are being issued with a coupon of : a firms bonds are rated baa. currently new baa bonds are being issued with a coupon of 7. assuming the firms income

I have dissertation to write of 12000 words with a topic : i have dissertation to write of 12000 words with a topic employee performancecan a high standard employee performance

Allocate the support service costs using the sequential : duweynie pottery inc. is divided into two operating divisions pottery and retail. the company allocates power and

What is the cost of the preferred capital of a firm whose : what is the cost of the preferred capital of a firm whose currently outstanding preferred shares pay a dividend of

User Account

All Pages