Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 35% corporate tax rate and no valuation allowance.

Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are listed below.

Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest, and it incurred $500 in nondeductible meals
and entertainment expense. Provide the income tax footnote rate reconciliation for Black, using either
dollars or percentages.

Question

Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 35% corporate tax rate and no valuation allowance.
​
  
Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are listed below.
​
​
  
Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest, and it incurred $500 in nondeductible meals
and entertainment expense. Provide the income tax footnote rate reconciliation for Black, using either
dollars or percentages.

Quizplus · Accepted Answer

The Answer of Black, Inc., is a domestic corporation with the following balance sheet for book and tax purposes at the end of the year. Assume a 35% corporate tax rate and no valuation allowance.
​
  
Black, Inc.'s, gross deferred tax assets and liabilities at the beginning of Black's year are listed below.
​
​
  
Black, Inc.'s, book income before tax is $6,000. Black records two permanent book-tax differences.
It earned $250 in tax-exempt municipal bond interest, and it incurred $500 in nondeductible meals
and entertainment expense. Provide the income tax footnote rate reconciliation for Black, using either
dollars or percentages.