Question

Daisy, Inc., hopes to report a total book tax expense of $160,000 in the current year. This $160,000 expense consists of $240,000 in current tax expense and an $80,000 tax benefit related to the expected future use of an NOL by Daisy. If the auditors determine that a valuation allowance of $30,000 must be placed against Daisy's deferred tax assets, what is Daisy's total book tax expense

Answer 1

$190,000

Step-by-step explanation:

Calculation for total book tax expense

Using this formula

Total book tax expense=Total book tax expense+Valuation allowance

Let plug in the formula

Total book tax expense=$160,000+$30,000

Total book tax expense=$190,000

Therefore Daisy's total book tax expense will be $190,000