UMGC ACCT 311 Intermediate Accounting II Final Exam All Chapters questions and answers – 2025 University of Maryland Global Campus ACCT 311 Final Exam All Chapters 1. Stellar Corporation began operations in 2025 and reported pretax financial income of $212,000 for the year. Stellar’s tax depreciation exceeded its book depreciation by $33,000. Stellar’s tax rate for 2025 and years thereafter is 30%. In its December 31, 2025, balance sheet, what amount of deferred tax liability should be reported? Book Depreciation $33,000 * Tax Rate 30% = $9,900 2. Waterway Corporation began operations in 2025 and reported pretax financial income of $228,000 for the year. Waterway’s tax depreciation exceeded its book depreciation by $38,000. Waterway’s tax rate for 2025 and year thereafter is 30%. Assume this is the only difference between Waterway’s pretax financial income and taxable income. Prepare the journal entry to record the income tax expense, deferred income taxes, and income taxes payable. Account Titles Income Tax Expense $57,000 + $11,400 Deferred Tax Liability $38,000 * 30% Income Tax Payable ($228,000 - $38,000) * 30%
Debit 68,400
Credit 11,400 57,000
Show how the deferred tax liability will be classified on the December 31, 2025, balance sheet. The $11,400 deferred tax liability should be classified as a noncurrent liability. 3. Stellar Inc. incurred a net operating loss of $549,000 in 2025. The tax rate for all years is 30%. Prepare the journal entries to record benefits of the loss carryforward. Stellar expects to return to profitability in 2026. Deferred Tax Asset = Net Operating Loss * Tax Rate Account Titles Deferred Tax Asset $549,000 * 30% Income Tax Expense
Debit 164,700
Credit 164,700