What Is the Income Tax Payable Under the Deferral Method

question 44

Multiple Choice

What is the income tax payable under the deferral method for F2013? $$\begin{array} { | l | r | r | r | } \hline & \text { F2013 } & \text { F2014 } & \text { F2015 } \\\hline \text { Income before tax } & 120,000 & 110,000 & 120,000 \\\hline \text { Taxable income } & 85,000 & 95,000 & 105,000 \\\hline \text { Tax rate } & 30 \% & 25 \% & 30 \% \\\hline\end{array}$$

• A)$25,500
• B)$30,000
• C)$30,750
• D)$36,000

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Definitions:

Joint Operation

A business arrangement where two or more parties share control and management of a project or business.

Joint Venture

A business arrangement where two or more parties agree to pool their resources for the purpose of accomplishing a specific task or business activity.

Rights To Net Assets

The entitlements that equity holders have to a company's assets after all liabilities have been settled.

Specific Assets And Liabilities

Items on a company's balance sheet that are clearly identified and quantified, including cash, inventory, debt, and equity.