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Whatever Co. has net revenue, before all items causing timing differences, of $150,000 in 2000A...

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Accounting

Whatever Co. has net revenue, before all items causing timing differences, of $150,000 in 2000A and $225,000 in 2000B. The only items causing timing differences are Whatever's accounting for estimated warranty expenses and depreciation on a 5-year asset. The asset, which cost Whatever $25,000 on 1/1/A and has no salvage value, is being depreciated straight-line for financial accounting purposes, but 10-8-7 for tax purposes. In 2000A and 2000B, Whatever accrued warranty expenses of $15,000 and $20,000; expenditures in these years totaled $10,000 and $15,000, respectively. Whatever issued no warranties prior to 2000A; during 2000A and thereafter, Whatever's warranty covers parts for 1 year after the date of sale. Assume a tax rate of 40% during 2000A. During 2000B, the rate for 2000B and thereafter is changed to 30%. Provide the following information: a. 2000A tax expense entry. b. 2000B tax expense entry. c. On their 2000A balance sheet, Whatever will report a net noncurrent DTL/A (specify which) of ______________.

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