At December 31, DePaul Corporation had a $30 million balance in its deferred...
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At December 31, DePaul Corporation had a $30 million balance in its deferred tax asset account and a $158 million balance in its deferred tax liability account. The balances were due to the following cumulative temporary differences: 1. Estimated warranty expense, $35 million: expense recorded in the year of the sale tax 2. Depreciation expense, $270 million: straight-line in the income statement; MACRS on 3. Income from installment sales of properties, $125 million: income recorded in the year of 4. Rent revenue collected in advance, $40 million; taxable in the year collected: recorded deductible when paid (one-year warranty) the tax return. the sale; taxable when received equally over the next five years as income when the performance obligation is satisfied in the following year. Required: Assuming DePaul will show a single noncurrent net amount in its December 31 balance sheet, indicate that amount and whether it is a net deferred tax asset or liability. The tax rate is 40%. Determine the deferred tax amounts to be reported in the December 31 balance sheet. The tax rate is 40%. (Enter your answers in millions) million
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