Use the Following Information for Questions

question 36

Multiple Choice

Use the following information for questions.
Mitchell Corporation prepared the following reconciliation for its first year of operations:

The temporary difference will reverse evenly over the next two years at an enacted tax rate of 40%.The enacted tax rate for 2011 is 35%.
-What amount should be reported in its 2011 income statement as the deferred portion of income tax expense?

• A)$90,000 debit
• B)$120,000 debit
• C)$90,000 credit
• D)$105,000 credit

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