How should boze report the deferred tax effect


The financial reporting carrying value of Boze Music's only depreciable asset exceeded its tax basis by $150,000 at December 31, 2009. This was a result of differences between straight line depreciation for financial reporting purposes and MACRS for tax purposes. The asset was acquired earlier in the year. Boze has no other temporary differences. The enacted tax rate is 30% for 2009 and 40% thereafter. How should Boze report the deferred tax effect of this difference in its December 31, 2009, balance sheet? (what account and what amount?)

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Accounting Basics: How should boze report the deferred tax effect
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