In 2014,a company paid $4,500 which it owed from its 2013 income tax liability and $30,000 for its 2014 tax liability.The company still owes $6,000 at year-end.How much should the company report as cash paid for income taxes on its 2014 statement of cash flows,using the direct method?
A)$34,500
B)$40,500
C)$30,000
D)$3,500

Question

Quizplus · Accepted Answer

The company should report $34,500 as cash paid for income taxes, which includes the $4,500 paid for the 2013 liability and the $30,000 paid for the 2014 liability.

In 2014,a Company Paid $4,500 Which It Owed from Its