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Abbot Corporation reported pretax book income of $500,000. During the current year, the reserve for bad debts increased by $5,000. In addition, tax depreciation exceeded book depreciation by $40,000. Finally, Abbot received $3,000 of tax-exempt life insurance proceeds from the death of one of its officers. Abbot's current income tax expense or benefit would be:

Respuesta :

abiolataiwo2015

Answer:

$157,080

Explanation:

Calculation to determine what Abbot's current income tax expense or benefit would be:

Current income tax expense or benefit=[($500,000 + $5,000 - $40,000 - $3,000)*34%]

Current income tax expense or benefit= $462,000* 34%

Current income tax expense or benefit=$157,080

Therefore Abbot's current income tax expense or benefit would be:$157,080

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