Answer:
The right answer is "$9,000". A further explanation is given below.
Explanation:
The given values are:
Rex paid dividends,
= $300,000
Reported earnings,
= $900,000
Investment,
= 30%
Taxable rate applicable,
= 25%
Now,
Throughout the future years, the amount of dividends taxable will be:
= [tex](900,000 - 300,000)\times 30 \ percent[/tex]
= [tex]180,000[/tex] ($)
Dividends received deduction will be:
= [tex]180,000\times 80 \ percent[/tex]
= [tex]144,000[/tex] ($)
then,
Net taxable dividend will be:
= [tex]180,000-144,000[/tex]
= [tex]36,000[/tex]
hence,
Deferred tax liability will be:
= [tex]36,000\times 25 \ percent[/tex]
= [tex]9,000[/tex] ($)