Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the
end of the year.Assume a 35% corporate tax rate and no valuation allowance. Assets Cash Accounts Receivable Buildings Accumulated Depreciation Furniture & Fixtures Accumulated Depreciation Total Assets Liabilities Accrued Litigation Expense Note Payable Total Liabilities Stockholders’ Equity Paid in Capital Retained Earnings Total Liabilities and Stockholders’ Equity Tax Debit/(Credit) $3005,000300,000(150,000)40,000(21,000)$174,300$−0−(116,000)($116.000)($1,000)(57,300)($174,300) Book Debit/(Credit) $3005,000300,000(80,000)40,000(15,000)$250,300($27,000)(116,000)$143,000)($1,000)(106,300)($250,300) Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are listed below. Accrued Litigation Expense Subtotal Applicable Tax Rate Gross Deferred Tax Asset Building -Accumulated Depreciation Furniture & fixtures - Accumulated Depreciation Subtotal Applicable tax rate Gross deferred tax liability Beginning of Year $20,000$20,000×35%$7.000($61,000)(3,000)($64,000)×35%($22,400) ?
Black, Inc.'s, book income before tax is $6,000.Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest, and it incurred $500 in nondeductible meals
and entertainment expense.Determine the net deferred tax asset or net deferred tax liability at year end.
Definitions:
Bid-Rigging Cartel
An illegal agreement among competitors to fix bidding prices, eliminating competition in the market.
Winning Bid
refers to the highest offer made in an auction that is accepted by the seller, resulting in a sale.
Bidders Values
The subjective valuation individual bidders place on the item or service being auctioned.
Low-Value
Referring to items or activities that offer minimal benefits or importance.