Deferred Tax Asset and Liability. CPA Exam Simulation. Intermediate Accounting.

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Graphic Explanation : for 2020 : I owe Tax on 732K (Income Tax) TE = 54.5+10 = 65.5K I paid Tax on 692K I owe Tax on 40k* (DTL) DTL = +40k*0.25 = +10K TL = (258k -40k)*0.25 =54.5K |________________________________________|____________________________| for 2021 : I owe Tax on 822K + 40k* =862 I paid Tax on 850K =822K + 28K I owe Tax on 12k** DTL = -28K*0.25 = -7K -------------> |________________________________________|____________________|________| for 2022 : I owe Tax on 782K + 12k** =794k I paid Tax on 774k I owe Tax 8k +12k**=20k DTL = +8k *0.25 = +2K -----------------------------> |___________________________________________________|_______|__________|