- This topic has 4 replies, 5 voices, and was last updated 3 years, 3 months ago by
Tncincy.
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agripper
ParticipantWhere is the $8000?
At December 31, 20X1, Bren Co. had the following deferred income tax items:
A deferred income tax liability of $15,000 related to a noncurrent asset
A deferred income tax asset of $3,000 related to a noncurrent liability
A deferred income tax asset of $8,000 related to a current liabilityWhich of the following should Bren report in the noncurrent section of its December 31, 20X1, balance sheet?
A.A noncurrent asset of $3,000 and a noncurrent liability of $15,000
Correct B.A noncurrent liability of $12,000
C.A noncurrent asset of $11,000 and a noncurrent liability of $15,000
D.A noncurrent liability of $4,000
You are correct, the answer is B.FASB ASC 740-10-45-4 provides that “an enterprise shall separate deferred tax liabilities and assets into a current amount and a noncurrent amount.”
Note that “amount” is singular, indicating that separate asset and liability amounts should be “netted,” leaving a single amount.
Amount to be reported in Bren's noncurrent section of balance sheet at December 31, 20X1:
Deferred tax liability $15,000
Less deferred tax asset (3,000)
Net noncurrent liability to
be reported on balance sheet $12,000
========Anonymous
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smurf
ParticipantNot sure were you got that answer but its (now) wrong. Now the correct answer should be A non-current liability of $4,000. Under GAAP, deferred tax liabilities and assets should be recorded as a noncurrent number on the b/s. all deferred tax liabilites and assets must be netted and shown as a signle amount. 15-3-8=4 noncurrent liab.
Lidis
ParticipantHello Agripper
You can not mix current with noncurrent. You can offset noncurrent deferred assets with noncurrent deferred tax liability.
But current with noncurrent is not allowed.
LidisTncincy
Participant2015 question?
It begins with a 75
Been here too long as a cheerleader.....time to pass -
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