Kent Inc.’s reconciliation between financial statement and taxable income for 20X1 follows:

Pre-tax financial income ........................................ $150,000
Permanent difference ............................................... (12,000)
                                                                                        138,000
Temporary difference—depreciation ....................... (9,000)
Taxable income ...................................................... $129,000

Additional Information:

The enacted tax rate is 21%.

Required:

1. In its December 31, 20X1, balance sheet, what amount should Kent report as its deferred tax liability?

2. In its 20X1 income statement, what amount should Kent report as the current portion of income tax expense?

3. In its 20X1 income statement, what amount should Kent report as the deferred portion of income tax expense?

Transcribed Image Text:

At December 31, 20X0 20X1 $20,000 Cumulative temporary difference (future taxable amounts) $11,000