In its first year of business, Doris Company had pretax accounting income of $640,000 and taxable income of $750,000 for the year ended 12-31-19

Accounting Nov 28, 2020

In its first year of business, Doris Company had pretax accounting income of $640,000 and taxable income of $750,000 for the year ended 12-31-19. The only temporary difference is accrued product warranty costs of which $40,000 will be paid in 2020 and $70,000 will be paid in 2021.The enacted income tax rates are 25% for 2019, 23% for 2020, and 20% for 2021. Assume Doris expects taxable income in future years. What deferred tax asset will Doris report on its 12-31-19 balance sheet?

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