million. For financial reporting purposes, the firm will depreciate the equipment over a 7-year life using straight-line depreciation and a zero salvage value; for tax reporting purposes, however, the firm will use 3-year accelerated depreciation. Given a tax rate of 35% and a first-year accelerated depreciation factor of 0.333, by how much will the company’s deferred tax liability increase in the first year of the equipment’s life?
A.$931,700.
B.$1,064,800.
C.$1,730,300.
第1题
A company records the following two transactions:
I.€300,000 of rental revenue is received in advance on a two-year lease.It is taxed on a cash basis, but deferred for accounting purposes.
II.€500,000 of installment sales.No payments are required for one year after which collections will be made on an equal basis over 12 months and taxed on a cash basis.The entire sale and related profit will be recognized for financial reporting purposes, in the year of sale.
Which of the above transactions will most likely give rise to a deferred tax liability on the balance sheet?
A.I only.
B.II only.
C.Both I and II.
第2题
ese costs were fully deductible immediately for tax purposes, but the company is depreciating them over two years for financial reporting purposes.The company has a long history of profitability.When calculating the company’s debt-to-equity ratio, the most appropriate way for an analyst to incorporate the differential tax treatment is to:
A.include it in equity.
B.include it in liabilities.
C.not include it in either equity or liabilities.
第3题
xpected residual value.The company depreciates similar assets on a straight-line basis over 10 years while the tax authorities allow depreciation at the rate of 15% per year.In both cases the company takes a full year’s depreciation in the first year.At the end of the year, the tax base and temporary difference in the value of the asset, respectively, are closest to:
A.$425,000; $25,000.
B.$425,000; $75,000.
C.$500,000; $25,000.
第4题
Under U.S.GAAP, which of the following factors is an analyst least likely to consider when determining if a company’s deferred tax liabilities should be treated as a liabilities or equity?
A.The growth rate of the firm.
B.The average discount rate of liabilities.
C.the expectation that temporary difference will reverse.
第5题
lity) when:
A.the deferred tax liabilities are expected to decline over time.
B.the deferred tax liabilities are predominantly comprised of permanent differences.
C.a change in tax law may result in the deferred taxes never being paid by the company.
第6题
.It is estimated that Bao will incur $100,000 in warranty expenses during its 5-year warranty period.Bao’s tax rate is 30%.To account for the tax implications of the warranty obligation prior to incurring warranty expenses, Bao should:
A.record a deferred tax asset of $30,000.
B.record a deferred tax asset of $30,000.
C.make no entry until actual warranty expenses are incurred.
第7题
income if $80,000 and pretax income is $100,000.The current tax rate is 50%, and the new tax rate is 40%.The difference in taxes payable between the two rates is closest to:
A.$8,000.
B.$9,000.
C.$10,000.
第8题
A permanent difference in pretax and taxable income is least likely to result when:
A.tax-exempt interest is received.
B.the installment sales method is used.
C.premiums are paid on life insurance of key employees.
第9题
When the expected tax rate changes, deferred tax:
A.expense is calculated using current tax rates with no adjustments.
B.liability and asset accounts are adjusted to reflect the new expected tax rate.
C.liability and asset accounts are maintained at historical tax rates until they reverse.
第10题
ate?
A.Income tax expense is based on current period pretax income adjusted for any changes in deferred tax assets and liabilities.
B.A valuation allowance is a reserve against deferred tax assets based on the likelihood that those assets will not be realized.
C.A deferred tax liability is created when tax expense is less than taxes payable and the difference is expected to reverse in future years.
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