What amount should shaw-anderson report as deferred portion

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Problem

The reconciliation of pretax financial statement income to taxable income is shown below for Shaw-Anderson Industries for the year ended December 31, 2021, its first year of operations. The company offers quality-assurance warranties that extend six months after goods are purchased. The income tax rate is 40%. Pretax accounting income (income statement) $640,000 Interest revenue on municipal securities (20,000) Warranty expense in excess of deductible amount 45,000 Depreciation in excess of financial statement amount (120,000) Taxable income (tax return) $545,000. Get the instant assignment help. What amount should Shaw-Anderson report as the deferred portion of income tax expense on its 2021 income statement?

Reference no: EM133901362

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