For Calendar 2020, Its First Year of Operations, Lion Ltd

question 15

Short Answer

For calendar 2020, its first year of operations, Lion Ltd. reported pre-tax accounting income of $ 100,000. Lion uses CCA for tax purposes and straight-line depreciation for financial reporting. The differences between depreciation and CCA over the five-year life of their assets, and the enacted tax rates for 2020 to 2024 are as follows: $$\begin{array}{l}\begin{array} { c c c } &\text { Depreciation }\\& \text { Over (Under) CCA } & \text { Tax Rates } \\2020 & \$ ( 20,000 ) & 35 \% \\2021 & ( 26,000 ) & 30 \% \\2022 & ( 6,000 ) & 30 \% \\2023 & 24,000 & 30 \% \\2024 & 28,000 & 30 \%\end{array}\end{array}$$ There are no other reversible differences. On Lion's December 31, 2020 SFP, the deferred tax liability and the current income taxes payable should be Deferred Current Income

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Definitions:

Maslow's Theory

A hierarchy of human needs conceptualized by Abraham Maslow, suggesting that people are motivated to fulfill basic needs before moving on to other, more advanced needs.

Higher Motives

Desires that go beyond basic physiological needs, such as aspirations for achievement, self-actualization, and the search for meaning.

Extremely Stimulating Activities

Actions or tasks that highly engage and arouse interest, attention, or excitement.

Arousal Theory

A theory suggesting that people are motivated to maintain an optimal level of arousal, neither too high nor too low, which can affect performance and mood.