Balance in the deferred tax liability problem


Giada Foods reported $940 million in income before income taxes for 2009, its first year of operations. Tax depreciation exceeded depreciation for financial reporting purposes by $100 million. The income tax rate for 2009 was 35%, but the enacted rate for years after 2009 is 40%. The balance in the deferred tax liability in the December 31, 2009, balance sheet is:

A. $16 million

B. $35 million

C. $40 million

D. $56 million

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Accounting Basics: Balance in the deferred tax liability problem
Reference No:- TGS074047

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