Use the Following Information for Questions 76-78

question 68

Multiple Choice

Use the following information for questions 76-78.
At the beginning of 2015; Elephant, Inc. had a deferred tax asset of $10,000 and a deferred tax liability of $15,000. Pre-tax accounting income for 2015 was $750,000 and the enacted tax rate is 40%. The following items are included in Elephant's pre-tax income:
-Which of the following is required to adjust Elephant, Inc.'s deferred tax asset to its correct balance at December 31, 2015?

• A) A credit of $52,000
• B) A credit of $38,000
• C) A debit of $38,000
• D) A debit of $42,000

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Definitions:

Nitrogen

A colorless, odorless, tasteless gas that is the most abundant element in Earth's atmosphere, essential for plant and animal life.

Atmosphere

The layer of gases surrounding a planet, crucial for supporting life on Earth, composed mainly of nitrogen, oxygen, argon, and carbon dioxide.

Fossil Fuels

Naturally occurring carbon-based fuels derived from the decomposed remains of ancient plants and animals, such as coal, oil, and natural gas.

Energy Pyramid

For an ecosystem, a graphic depicting the energy that flows through each trophic level in a given interval.