Pindex owns 75% of the voting common stock of its domestic subsidiary, Spindex. During 2006, Spindex had net income of $800,000 and paid dividends of $200,000. The remaining $600,000 of net income is expected to be invested indefinitely. Pindex's income tax rate is 40%. At 12/31/06, how much should Pindex report as a deferred income tax liability relating to the Spindex's 2006 earnings? Show the calculation.

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The Answer of Pindex owns 75% of the voting common stock of its domestic subsidiary, Spindex. During 2006, Spindex had net income of $800,000 and paid dividends of $200,000. The remaining $600,000 of net income is expected to be invested indefinitely. Pindex's income tax rate is 40%. At 12/31/06, how much should Pindex report as a deferred income tax liability relating to the Spindex's 2006 earnings? Show the calculation.

Pindex Owns 75% of the Voting Common Stock of Its