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At December 31, 2017, Bren Co. has the following deferred income tax items: • A deferred...

At December 31, 2017, Bren Co. has the following deferred income tax items: • A deferred income tax liability of $15,000 related to a non-current asset • A deferred income tax asset of $3,000 related to a non-current liability • A deferred income tax asset of $8,000 related to a current liability Which of the following should Bren report in the non-current section of its December 31, 2017 balance sheet?

A) A non-current liability of $4,000.

B) A non-current asset of $11,000 and a non-current liability of $15,000.

C) A non-current liability of $12,000.

D) A non-current asset of $3,000 and a non-current liability of $15,000.

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Answer #1

Correct option is C i.e. A non current Liability of $12,000.

Reason :-

$8,000 related to current section which doesn't affect non current section.

Enterprise shall separate deferred tax liability and assets in current and non current amount.

Amount of asset and liability should be netted into an single amount.

Bren co. Report in its non-current section is:-

Deferred income tax liability $15,000 and deferred income tax assets $3,000 results in non current Liability of $12,000.

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