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What amount should lion report as total deferred tax expense

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Reference no: EM132764556

Lion Co.'s income statement for its first year of operations shows pretax income of $6,000,000. In addition, the following differences existed between Lion's tax return and records:

                                                 Tax return             Accounting records
Credit loss expense              $220,000               $250,000
Depreciation expense             $860,000               $570,000
Tax-exempt interest revenue      -                        $50,000

Problem 1: Lion's current-year tax rate is 30%, and the enacted rate for future years is 40%. What amount should Lion report as total deferred tax expense in its income statement for the year?

A. $78,000

B. $104,000

C. $124,000

D. $148,000

 

Reference no: EM132764556

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