Question

Four independent situations are described below. Each involves future deductible amounts and/or future taxable amounts produced by temporary differences: ($ in thousands) Situation 1 2 3 4 Taxable income $ 88 $ 220 $ 204 $ 272 Future deductible amounts 16 20 20 Future taxable amounts 16 16 32 Balance(s) at beginning of the year: Deferred tax asset 2 10 4 Deferred tax liability 8 2 The enacted tax rate is 25%. Required: For each situation, determine the following: (Enter your answers in thousands rounded to one decimal place (i.e. 1,200 should be entered as 1.2). Negative amounts should be indicated by a minus sign. Leave no cell blank, enter "0" wherever applicable.

Answer 1

	Title	1	2	3	4
1	Taxable income	$88	$220	$204	$272
	Income tax payable(Tax rate @ 25%)	$22	$55	$51	$68
2	Future deductible amounts	$16	$0	$20	$20
	Differed tax asset balance (@25%)	($4)	$0	($5)	($5)
3	Balance(s) at beginning of the year:	$2	$0	$10	$4
	Deferred tax asset	($2)	$0	$5	($1)
4	Future taxable amounts	$0	$16	$16	$32
	Deferred tax liability balance(@ 25%)	$0	$4	$4	$8
	Balance(s) at beginning of the year:	$0	$8	$2	$0
5	Deferred tax liability	$0	($4)	$2	$8
6	Income tax Payable	22	55	51	68
	Deferred tax asset	($2)	$0	$5	($1)
	Deferred tax liability	$0	($4)	$2	$8
	IncomeTax Expense	$20	$51	$58	$75

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