What is the journal entry required to recognize a deferred tax asset of $50,000?
A) Dr. Deferred Tax Asset $50,000, Cr. Income Tax Benefit $50,000
B) Dr. Deferred Tax Asset $50,000, Cr. Equity $50,000
C) Dr. Income Tax Expense $50,000, Cr. Deferred Tax Asset $50,000
D) Dr. Deferred Tax Asset $50,000, Cr. Deferred Tax Liability $50,000

Question

Quizplus · Accepted Answer

A deferred tax asset represents an amount that a company expects to use to reduce future tax payments. The journal entry to recognize a deferred tax asset is to debit Deferred Tax Asset for the amount of the asset and credit Income Tax Benefit.

What Is the Journal Entry Required to Recognize a Deferred