Problem:
Phillips, inc., a cash basis C corporation, completes $100,000 in sales for year 1, but only $75,000 of this amount is collected during year 1. the remaining $25,000 from these sales is collected promptly during the first quarter of year 2. the applicable income tax rate for year 1 and thereafter is 30%.
Required:
Question: Compute Phillip's year 1 current and deferred income tax expense.
Note: Be sure to show how you arrived at your answer.