All-Star Enterprises purchased a machine on January 1. The company uses straight-line depreciation for financial reporting and a

Question

2 years ago

15

All-Star Enterprises purchased a machine on January 1. The company uses straight-line depreciation for financial reporting and a

ccelerated depreciation for tax purposes. Depreciation for tax purposes during the year was $36,000 greater than depreciation for financial reporting. Assuming a 30% tax rate will apply in the future, how much will be recorded as a deferred tax liability during the year

Business

1 answer:

maks197457 [2] · Answer 1 · 2023-09-16T03:46:50+03:00

The amount that will be recorded as a deferred tax liability during the year is $10800.

<h3>How to calculate the tax liability?</h3>

From the information given, the depreciation for tax purposes during the year was $36,000 greater than depreciation for financial reporting and a 30% tax rate will apply in the future.

Therefore, the amount that will be recorded as a deferred tax liability during the year will be:

= 30% × $3600

= 0.3 × $36000

= $10800

Learn more about tax on:

brainly.com/question/25783927

#SPJ1