Gretna Corp

question 14

Multiple Choice

Gretna Corp. reported the following results for calendar 2017, its first year of operations: The difference between accounting income and taxable income is due to a temporary difference, which will reverse in 2018. Assuming that the enacted tax rates in effect are 30% in 2017 and 25% in 2018, what amount should Gretna record as the deferred tax asset or liability for calendar 2017?

• A)$45,000 deferred tax liability
• B)$37,500 deferred tax asset
• C)$45,000 deferred tax asset
• D)$37,500 deferred tax liability

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