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What is the deferred tax liability under the deferral method for F2015

What is the deferred tax liability under the deferral method for F2015?

 

 

F2013

F2014

F2015

Income before tax

120,000

110,000

150,000

Taxable income

85,000

95,000

105,000

Tax rate

30%

25%

35%

 

A) $52,500

B) $36,750

C) $27,500

D) $15,750

22) Which statement is correct?

A) The deferral and accrual methods produce the same tax expense when tax rates are constant.

B) The deferral method applies new tax rates to accumulated tax balances.

C) The accrual method applies new tax rates to only to current year's income.

D) The deferral and accrual methods produce the same tax expense when tax rates are falling.

 

23) How much tax expense would be recorded under the accrual method for F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

30,000

 

 

Revenue

 

130,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

25%

35%

 

A) 5,000

B) 27,500

C) 32,500

D) 37,500

 

24) How much tax expense would be recorded under the accrual method for F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

30,000

 

 

Revenue

 

130,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

35%

35%

 

A) 5,000

B) 27,500

C) 32,500

D) 37,500

25) How much tax expense would be recorded under the accrual method for F2015?

 

 

F2014

F2015

Deferred tax liability

27,500

 

Revenue

 

150,000

Taxable income

 

105,000

Tax rate

25%

35%

 

A) 11,000

B) 42,500

C) 52,500

D) 63,500

 

26) Under the accrual method, what is the effect of the tax rate change in F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

30,000

 

 

Revenue

 

130,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

35%

35%

 

A) Increase of 5,000.

B) Decrease of 5,000.

C) Increase of 27,500.

D) Decrease of 27,500.

27) Under the accrual method, what is the effect of the tax rate change in F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

30,000

 

 

Revenue

 

130,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

35%

35%

 

A) Increase of 5,000.

B) Decrease of 5,000.

C) Increase of 32,500.

D) Decrease of 32,500.

 

28) Under the accrual method, what is the effect of the tax rate change in F2015?

 

 

F2014

F2015

Deferred tax liability

27,500

 

Revenue

 

150,000

Taxable income

 

105,000

Tax rate

25%

35%

 

A) Increase of 11,000.

B) Decrease of 11,000.

C) Decrease of 62,500.

D) Increase of 63,500.

29) Under the accrual method, what is the effect of the current year temporary difference in F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

30,000

 

 

Revenue

 

130,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

35%

35%

 

A) 5,000

B) 27,500

C) 32,500

D) 37,500

 

30) Under the accrual method, what is the effect of the current year temporary difference in F2014?

 

 

F2013

F2014

F2015

Deferred tax liability

27,000

 

 

Revenue

 

100,000

150,000

Taxable income

 

95,000

105,000

Tax rate

30%

35%

35%

 

A) 4,500

B) 30,500

C) 35,000

D) 39,500

Dec 12 2019 View more View Less

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