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Mitchell Corporation prepared the following reconciliation for its first year of operations:

The temporary difference will reverse evenly over the next two years at an enacted tax rate of 40%.The enacted tax rate for 2011 is 35%.
-What amount should be reported in its 2011 income statement as the deferred portion of income tax expense?

Question

Use the following information for questions.
Mitchell Corporation prepared the following reconciliation for its first year of operations:
  
The temporary difference will reverse evenly over the next two years at an enacted tax rate of 40%.The enacted tax rate for 2011 is 35%.
-What amount should be reported in its 2011 income statement as the deferred portion of income tax expense?

Quizplus · Accepted Answer

The deferred portion of income tax expense is the amount of income tax that has been recognized in the income statement but has not yet been paid to the government. In this case, the deferred portion of income tax expense is $90,000.

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