Problem:
Rubard Farms depreciates its assets at a faster rate for tax purposes then for GAAP financial statements purposes, and invests heavily in municipal bonds. In its first year of operations, the year ended December 31, 20X3, Rubarb's pretax financial income reconciles to its tax return income as follows:
Pre-tax financial income ............... $200,000
Excess depreciation per tax return .....(40,000)
Municipal bond interest.................. (10,000)
Taxable income .......................... $150,000
If the enacted tax rate for current and future periods were 25%, Rubarb would record a deferred tax liability of how much?