Mustang Company has a deferred tax asset of $200,000. At year end, Mustang determined that...
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Mustang Company has a deferred tax asset of $200,000. At year end, Mustang determined that $60,000 of this asset most likely will not be realized. Mustang's tax rate is 25%. The adjusting entry will include: credit income tax payable for $50,000 credit cash for $60,000 debit income tax expense for $60,000 debit valuation allowance - deferred tax asset for $140,000
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