Question

Wayne Co. had a decrease in deferred tax liability of $20 million, a decrease in deferred tax assets of $10 million, and an increase in tax payable of $100 million. The company is subject to a tax rate of 40%. The total income tax expense for the year was: Group of answer choices

Answer 1

Answer: $90 million

Step-by-step explanation:

From the question, we are informed that Wayne Co. had a decrease in deferred tax liability of $20 million, a decrease in deferred tax assets of $10 million, and an increase in tax payable of $100 million and that thee company is subject to a tax rate of 40%.

Based on the information above, the total income tax expense for the year will be:

= Increase in tax payable + Decrease in defered asset - Decrease in defered tax liability

= $100 + $10 - $20

= $90 million