Information for Kent Corp. for the year 2013: Reconciliation of pretax accountin
ID: 2647057 • Letter: I
Question
Information for Kent Corp. for the year 2013:
Reconciliation of pretax accounting income and taxable income:
(13,800)
(12,700)
$152,000
Cumulative future taxable amounts all from depreciation temporary differences:
As of December 31, 2012 $13,200
As of December 31, 2013 $25,900
The enacted tax rate was 23% for 2012 and thereafter.
What should be the balance in Kent's deferred tax liability account as of December 31, 2013?
(13,800)
164,700 Temporary difference-depreciation(12,700)
Taxable income$152,000
Explanation / Answer
Deferred tax liability as of December 31, 2013 = $25,900 x 23% = $5,957
Therefore, Option b) $5,957 is the correct answer.