Yverdal carries a deferred tax asset of 120,000 on its tax losses carried forward. At the reporting date, the loss of a major customer reduces the losses that are probably usable to 280,000 (case assumption). Tax rate: 25%. Record the closing entry.
- Deferred tax asset on losses at the beginning of the year
- 120,000
- Losses still probably usable
- 280,000
- Tax rate (%)
- 25 %