What is the best estimate of the deferred tax balance

Assignment Help Financial Accounting

Reference no: EM133328132

Given:

Crown Corp bought equipment late in 2021.

Crown Corp claimed CCA on its 2021 tax return. No depreciation was recorded because the equipment had not yet been put into use.

This temporary difference will reverse. It will create taxable amounts of:

$25,000 in 2022

$30,000 in 2023

and $40,000 in 2024.

Crown's accounting income for 2021 is $200,000.

The tax rate is 30% for all years.

There are no deferred tax accounts at the start of 2021.

Question:

What is the best estimate of the deferred tax balance on December 31, 2022?

Reference no: EM133328132

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