Ray Co. began operations in the current year and reported $225,000 in income before income...
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Ray Co. began operations in the current year and reported $225,000 in income before income taxes for the year. Rays current-year tax deprecation exceeded its book depreciation by $25,000. Ray also had non-deductible book expenses of $10,000 related to permanent differences. Rays tax rate for the current year was 40%, and 35% for the following years. In its current year balance sheet, what amount of deferred income tax liability should Ray report?
$8,750
$10,000
$12,250
$14,000
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