Question: (Two Differences, Two Rates, Future Income Expected) Presented below are two independent situations related to future taxable and deductible amounts resulting from temporary differences existing at December 31, 2014.
1. Mooney Co. has developed the following schedule of future taxable and deductible amounts.
Both Mooney Co. and Roesch Co. have taxable income of $4,000 in 2014 and expect to have taxable income in all future years. The tax rates enacted as of the beginning of 2014 are 30% for 2014-2017 and 35% for years thereafter. All of the underlying temporary differences relate to noncurrent assets and liabilities. Instructions For each of these two situations, compute the net amount of deferred income taxes to be reported at the end of 2014, and indicate how it should be classified on the balance sheet.