$2622800 Blossom Corporation\'s partial income statement after its first year of

Question

$2622800

Blossom Corporation's partial income statement after its first year of operations is as follows:
Income before income taxes $3726000 Income tax expense Current $1015000 Deferred        88200 1103200 Net income

$2622800

Blossom uses the straight-line method of depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The amount charged to depreciation expense on its books this year was $2780000. No other differences existed between book income and taxable income except for the amount of depreciation. Assuming a 30% tax rate, what amount was deducted for depreciation on the corporation's tax return for the current year?

$2486000 $1117800 $2780000 $3074000

Explanation / Answer

Amount deducted for depreciation on the corporation's tax return for the current year = 2780000+(88200/30%)= 3074000 Option 4 is correct

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