Business, 14.05.2021 18:40 rprest00

Lynch Company began operations in 2019. The company reported $24,000 of depreciation expense on its income statement in 2019 and $26,000 in 2020. On its tax returns, Lynch deducted $32,000 for depreciation in 2019 and $37,000 in 2020. The 2020 tax return shows a tax obligation (liability) of $12,000 based on a 25% tax rate. Required:
Determine the temporary difference between the book value of depreciable assets and the tax basis of these assets at the end of 2019 and 2020.

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Lynch Company began operations in 2019. The company reported $24,000 of depreciation expense on its...

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