Geisler Corp

question 12

Multiple Choice

Geisler Corp.provided you with the following information for the year ending December 31,2017: Net Income before taxes: $150,000
Depreciation (included in above) $90,000
CCA$250,000
The net book value of the capital assets was $1,100,000,and their UCC was $900,000 on January 1,2017.
A temporary difference of $200,000 is reflected in an accumulated deferred income tax liability (DTL) balance of $90,000 at January 1,2017.
There were no permanent differences.
Taxable income in the three-year carry back period was $400,000.Tax losses are carried back as far as allowable by law.
A tax rate of 45% applies to the current and previous years.
Geisler's 2017 journal entry to record its Deferred Tax amounts would include:

• A) a Deferred tax - benefit amount of $62,000.
• B) a Deferred tax - expense amount of $62,000.
• C) a Deferred tax - benefit amount of $72,000.
• D) a Deferred tax - expense amount of $72,000.

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Definitions:

Problem Solving

Problem solving is the cognitive process of finding a solution to a challenging situation or overcoming a barrier through logical thinking, creativity, and decision-making strategies.

Means-End Analysis

A problem-solving method that involves identifying the difference between the current state and the goal state, then creating and taking steps to reduce the difference.

Current State

The existing condition or situation of a system, organization, or individual at a particular time.

Eventual Goal

The ultimate aim or objective that is intended to be achieved in the long term, following the completion of all interim steps or phases.