Porpoise acquires 100% of Sunfish in a taxable business combination. The applicable tax rate is...
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Accounting
Porpoise acquires 100% of Sunfish in a taxable business combination. The applicable tax rate is 30%. Based on the following information about the assets and liabilities of Sunfish, what about should Porpoise record as a deferred tax balance for this acquisition for purposes of consolidation on the date of acquisition? Enter a minus sign to denote a credit. (e.g. -200).
Old book basis
Old tax basis
Fair value
Cash
$200,000
$200,000
$200,000
Equipment, net of depreciation
1,000,000
500,000
750,000
Patents
0
0
818,163
Accounts payable
(300,000)
(300,000)
(300,000)
Deferred income taxes payable
(150,000)
NA
?
Notes payable
(200,000)
(200,000)
(230,000)
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