Izzo Company reported pretax net income from continuing operations of $1,000,000 and taxable income of $800,000.The favorable book-tax difference of $200,000 was due to a $100,000 favorable temporary difference relating to depreciation,an unfavorable temporary difference of $50,000 due to accrued vacation pay,and a $150,000 favorable permanent difference from the domestic manufacturing deduction.Izzo Company's applicable tax rate is 34%.
a.Compute Izzo Company's current income tax expense.
b.Compute Izzo Company's deferred income tax expense or benefit.
c.Compute Izzo Company's effective tax rate.
d.Provide a reconciliation of Izzo Company's effective tax rate with its hypothetical tax rate of 34%.

Question

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The Answer of Izzo Company reported pretax net income from continuing operations of $1,000,000 and taxable income of $800,000.The favorable book-tax difference of $200,000 was due to a $100,000 favorable temporary difference relating to depreciation,an unfavorable temporary difference of $50,000 due to accrued vacation pay,and a $150,000 favorable permanent difference from the domestic manufacturing deduction.Izzo Company's applicable tax rate is 34%.
a.Compute Izzo Company's current income tax expense.
b.Compute Izzo Company's deferred income tax expense or benefit.
c.Compute Izzo Company's effective tax rate.
d.Provide a reconciliation of Izzo Company's effective tax rate with its hypothetical tax rate of 34%.

Izzo Company Reported Pretax Net Income from Continuing Operations of $1,000,000