LIABILITY+EXAMPLE+SOLUTION

LIABILITY+EXAMPLE+SOLUTION - L IAB I L I TY EXAM PLE SOLUT...

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LIABILITY EXAMPLE SOLUTION Year 1 Year 2 Year 3 Total Accounting Income 5,000 4,000 6,000 15,000 Expense 3,000 2,000 (200) 4,800 Payment (1000) (3,200) (600) (4,800) Taxable Income 7,000 2,800 5,200 15,000 Tax Rate 20% 20% 20% 20% CV FR 2,000 800 000 CV TR 000 000 000 Difference 2,000 800 000 FTA balance 400 160 000 Yr. Current Income Tax Expense 1,400
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1 Taxes Payable 1,400 Future Tax Asset 400 Future Income Tax Benefit 400 Yr.2 Current Income Tax Expense 560 Taxes Payable 560 Future Income Tax Expense 240 Future Tax Asset 240
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