What is the amount of the deferred tax asset

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Question - Carter Designs uses MACRS for income tax reporting and straight-line depreciation for financial statement reporting. Carter Designs balance sheet lists a building with a book value of $500,000. The building was purchased three years prior. The building has a tax basis of $350,000. Carter Designs has no other temporary or permanent differences. Other information: Taxable income $5 million; tax rate 30%. What is the amount of the 1) deferred tax asset or liability, if there is a deferred tax liability balance of $40,000 from the previous year? 2) Income Tax Payable and 3) Income Tax Expense.

Reference no: EM132903868

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