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The financial statements of Dekar Corp. for a four-year period reflected the following pre-tax amounts: Statement of Profit and Loss (sumarized) Revenues Expenses other than depreciation Depreciation expense (straight line) Pre-tax accounting income 20x4 $110,000 (80,000) (10,000) $ 20,000 2005 $124,000 (92,000) (10,000) $ 22,000 20x6 $144,000 (95,000) (30,000) $ 39,000 2017 $164,000 (128,000) (10,000) $ 26,000

The financial statements of Dekar Corp. for a four-year period reflected the following pre-tax amounts: Statement of Profit and Loss (sumarized) Revenues Expenses other than depreciation Depreciation expense (straight line) Pre-tax accounting income 20x4 $110,000 (80,000) (10,000) $ 20,000 2005 $124,000 (92,000) (10,000) $ 22,000 20x6 $144,000 (95,000) (30,000) $ 39,000 2017 $164,000 (128,000) (10,000) $ 26,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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4 eBook The financial statements of Dakar Corp. for a four-year period reflected the following pre-tax amounts: Statement of Profit and Loss (summarized) 20x4 $110,000 (50,000) (10,000) $ 20,000 Revenues Expenses other than depreciation Depreciation expense (straight-line) Pre-tax accounting income Machine (four year life, no residual value), at cost Less: Accumulated depreciation Deferred income tax balance Net income Statement of Financial Position (partial) 28X4 2005 $124,000 20X4 (92,000) (10,000) 20x5 $ 22,000 20XE Dakar has a tax rate of 40% each year and claimed CCA for income tax purposes as follows: 20x4, $16,000; 20x5, $12,000; 20x6. $8,000; and 20x7. $4,000. There were no deferred income tax balances at 1 January 20X4 28X6 $144,000 (95,000) (10,000) $ 39,000 Required: For each year, calculate the deferred income tax balance on the statement of financial position at the end of the year, and also net income. (Negative amounts and deductible amounts should be indicated by a minus sign.) 20x7 $164,000 (128,000) (10,000) $ 26,000 2005 20x6 40,000 3 $ 40,000 S 40,000 $ (10.000) (20,000) (30,000) $30,000 $ 20,000 $ 10,000 S 20X7 20x7 40,000 (40,000)
Transcribed Image Text:4 eBook The financial statements of Dakar Corp. for a four-year period reflected the following pre-tax amounts: Statement of Profit and Loss (summarized) 20x4 $110,000 (50,000) (10,000) $ 20,000 Revenues Expenses other than depreciation Depreciation expense (straight-line) Pre-tax accounting income Machine (four year life, no residual value), at cost Less: Accumulated depreciation Deferred income tax balance Net income Statement of Financial Position (partial) 28X4 2005 $124,000 20X4 (92,000) (10,000) 20x5 $ 22,000 20XE Dakar has a tax rate of 40% each year and claimed CCA for income tax purposes as follows: 20x4, $16,000; 20x5, $12,000; 20x6. $8,000; and 20x7. $4,000. There were no deferred income tax balances at 1 January 20X4 28X6 $144,000 (95,000) (10,000) $ 39,000 Required: For each year, calculate the deferred income tax balance on the statement of financial position at the end of the year, and also net income. (Negative amounts and deductible amounts should be indicated by a minus sign.) 20x7 $164,000 (128,000) (10,000) $ 26,000 2005 20x6 40,000 3 $ 40,000 S 40,000 $ (10.000) (20,000) (30,000) $30,000 $ 20,000 $ 10,000 S 20X7 20x7 40,000 (40,000)
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