In its first year of operations, Lear Company reported financial statement income (prior to income tax expense) of $100,000.In the same year, Lear Company reported $80,000 of taxable income, the difference being due to temporary differences.Assuming the enacted tax rate for the current year and all future years is 30%, what is Lear's current year adjustment for deferred income taxes?
A) Debit to Deferred Income Tax Liability for $6,000
B) Debit to Income Tax Expense for $6,000
C) Credit to Income Taxes Payable for $6,000
D) Credit to Deferred Income Tax Liability for $6,000
E) Credit to Income Tax Expense for $6,000
Correct Answer:
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