Gretna Corp $\begin{array}{lr}\text { Pre-tax account ing income } & \$ 250,000 \\\text { Taxable income } & 400,000\end{array}$

question 10

Multiple Choice

Gretna Corp. reported the following results for calendar 2020, its first year of operations: $\begin{array}{lr}\text { Pre-tax account ing income } & \$ 250,000 \\\text { Taxable income } & 400,000\end{array}$ The difference between accounting income and taxable income is due to a temporary difference, which will reverse in 2021. Assuming that the enacted tax rates in effect are 30% in 2020 and 25% in 2021, what amount should Gretna record as the deferred tax asset or liability for calendar 2020?

• 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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