Hertz Co. prepared the following reconciliation of its pretax financial statement income to taxable income for the year ended December 31, 2013, its first year of operations:
Pretax financial income.......................................................................$800,000
Nontaxable interest received on municipal securities......................................(30,000)
Estimated warranties not deductible for tax purpose in 2013..............................50,000
Depreciation in excess of financial statement amount....................................(70 ,000)
Taxable income$750,000
Hertz's tax rate for Year 2013 and for future years is 30%.
(a) In its Year 1 income statement, what amount should Hertz report as income tax expense-current portion?
(b) In its December 31, 2013 balance sheet, what amount should Hertz report as deferred income tax liability/asset?