Question

In addition to the temporary differences identified in Problems 49–52, Kantner reported two permanent book-tax differences. It earned $7,800 in tax-exempt municipal bond interest, and it reported $850 in nondeductible meals and entertainment expense. Kantner’s book income before tax is $50,000. With this additional information, calculate Kantner’s current tax expense.
In problem Based on the facts and results of Problem 49 and the beginning-of-the-year book-tax basis differences listed below, determine the change in Kantner’s deferred tax liabilities for the current year.
Beginning of Year
Building—accumulated depreciation ........... ($62,000)
Furniture & fixtures—accumulated depreciation ...... (400)
Subtotal ...................... ($62,400)
Applicable tax rate ................... x 34%
Gross deferred tax liability ................ ($21,216)


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  • CreatedMay 25, 2015
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