Please help! CoursHeroTranscribedText: Ayres Services acquired an asset for $192 million in 2021. The asset...
90.2K
Verified Solution
Link Copied!
Question
Accounting
Please help!
CoursHeroTranscribedText: Ayres Services acquired an asset for $192 million in 2021. The asset is depreciated for nancial reporting purposes over four years on a straight-line basis (no residual value). For tax purposes the assets cost is depreciated by MACRS. The enacted tax rate is 25%. Amounts for pretax accounting income, depreciation. and taxable income in 2021, 2022, 2023, and 2024 are as follows: ($ in millions) 2021 2022 2023 2024 Pretax accounting income $400 $420 $435 $470 Depreciation on the income statement 48 48 48 48 Depreciation on the tax return (63) (79) (29) (21) Taxable income $385 $389 $454 $497 Required: For December 31 of each year, determine (a) the cumulative temporary book-tax difference for the depreciable asset and (b) the balance to be reported in the deferred tax liability account. (Leave no cell blank, enter "0" wherever applicable. Enter your answers in millions rounded to 2 decimal place (i.e., 5,500,000 should be entered as 5.50).) CumulativeTemporary Difference $ 192.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00
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!
