Solution-What amount of deferred income tax liability stone

What amount of deferred income tax liability stone report

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Reference no: EM131831806

Question - Stone Co. began operations in Year 1 and reported $225,000 in income before income taxes for the year. Stone's Year 1 tax depreciation exceeded its book depreciation by $25,000. Stone also had nondeductible book expenses of $10,000 related to permanent differences. Stone's tax rate for Year 1 was 40%, and the enacted rate for years after Year 1 is 35%. In its December 31, Year 1, balance sheet, what amount of deferred income tax liability should Stone report?

a. $8,750

b. $10,000

c. $12,250

d. $14,000

Reference no: EM131831806

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What amount of deferred income tax liability stone report

Reference no: EM131831806

Reference no: EM131831806

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