Black, Inc

question 10

Essay

Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end
of the year. Assume a 35% corporate tax rate and no valuation allowance.

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Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are listed below.
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Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest, and it incurred $500 in nondeductible meals
and entertainment expense. Determine the change in Black's deferred tax assets for the current year.

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Definitions:

Claiming Habits

Patterns or tendencies of individuals or groups in asserting or establishing their rights, entitlements, or possessions, often in legal or business contexts.

Defined Contribution Plan

A type of retirement plan in which the employer, employee, or both make contributions on a regular basis, but the final benefit received by the employee depends on the plan's investment performance.

Length of Service

The duration of time an employee has worked for a particular employer, often affecting their eligibility for certain benefits or recognition.

Vesting

A provision in employer-provided retirement plans that gives workers the right to a pension after a specified number of years of service.