Mansfield Corporation purchased a new warehouse at the beginning of 2011 for $1,090,000. The expected life of the asset is 25 years with no residual value. The company uses straight-line depreciation for financial reporting purposes and accelerated depreciation for tax purposes (assume 10 percent of original cost for this problem). The company's marginal federal income tax rate is 30 percent. The company determined its income tax obligation was as follows: 2011, $407,000; 2012, $636,000.
1. Compute the deferred income tax amount reported on the balance sheet for each year. 2011 and 2012 2. Compute income tax expense for each year. 2011 and 2012
Compute the deferred income tax amount reported on the balance sheet for Compute the deferred income tax amount reported on the balance sheet for each year.