Greene Co. has pretax book income for the year ended December 31, 2018 in the amount of $315,000 and has a tax rate of 30%. Depreciation for tax purposes exceeded book depreciation by $10,500. What should Greene Co. record as its deferred tax liability for 2018?

Question

Quizplus · Accepted Answer

The deferred tax liability is calculated as the temporary difference ($10,500) multiplied by the tax rate (30%), which equals $3,150.

Greene Co Has Pretax Book Income for the Year Ended December