Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. bronson industries reported a deferred tax liabili

Bronson Industries reported a deferred tax liability of $8.5 million for the year ended December...

60.1K

Verified Solution

Question

Accounting

Bronson Industries reported a deferred tax liability of $8.5 million for the year ended December 31, 2020, related to a temporary difference of $34 million. The tax rate was 25%. The temporary difference is expected to reverse in 2022, at which time the deferred tax liability will become payable. There are no other temporary differences in 20202022. Assume a new tax law is enacted in 2021 that causes the tax rate to change from 25% to 20% beginning in 2022. (The rate remains 25% for 2021 taxes.) Taxable income in 2021 is $88 million. Required: 1. Determine the effect of the change and prepare the appropriate journal entry to record Bronsons income tax expense in 2021. 2. Is Bronson required to revise prior years financial statements as a result of the change? 3. Is Bronson required to provide a disclosure note to report the change?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Chemistry
1.2K views

Some special GC detectors, such NPD and FPD, are often used to analyzed nitrogen containing and...

Accounting
1.2K views

8. Exercise 15-12 Securities transactions; equity method LO P4 Listed below are a few events and transactions...

Geometry
1.2K views

b The mzBEA 41 3 What is the measure of minor arc BA B ct...

Basic Math
1.2K views

Find the perimeter of the triangle 8 ft 014 M 18 ft 24 ft 10...

Basic Math
1.2K views

4 For each equation identify the slope and y intercept of its graph a y...

Basic Math
1.2K views

The mean is the average of the numbers.Add up all the numbers, then divide by...

Accounting
1.2K views

Required information {The following information applies to the questions displayed below.) In this Applying Excel...

Accounting
1.2K views

for tax year beginning January 1, 2018, which of the following statements is teuea. the...

Accounting
1.2K views

Schedule of cash payments for a service company Horizon Financial Inc. was organized on February...

Accounting
1.2K views

Record the following transactions in the appropriate special journals or general journal for the month...

Accounting
1.2K views

QUESTION 2 Tim Company purchased a delivery truck for P50,000 on January 1,2021, with an...

Finance
1.2K views

Optimal Capital Structure with Hamada Beckman Engineering and Associates (BEA) is considering a change in...