As a result of differences between depreciation for financial reporting purposes and tax purposes, the financial reporting basis of Noor Co.’s sole depreciable asset acquired in the current year exceeded its tax basis by $250,000 at December 31. This difference will reverse in future years. The enacted tax rate is 30% for the current year and 40% for future years. Noor has no other temporary differences. In its December 31 balance sheet, how should Noor report the deferred tax effect of this difference?

Example1 lcnrv: ted company uses the lower of cost or nrv method in valuing its inventory items. the inventory at december 31, 2017, consists of products a, b and c, each having 1,000 units. relevant unit data for these products appear below: item a item b item c cost $ 80 $80 $80 estimated selling price 180 100 90 estimated selling cost 30 30 30 required: using the lower of cost or net realizable value rule, determine the proper value of inventory for balance sheet reporting purposes at december 31, 2017. prepare any necessary journal entry. apply the lower of cost or nrv method: • on an individual inventory basis; • on a group basis; • on a total inventory basis. solution worksheet: inventory (on an individual basis): inventory value item nrv cost lc- item a item b item c total inventory (on a group basis): inventory value item nrv cost lc- group 1 (item a and b) group 2 (item c) total inventory (on an aggregate inventory basis): inventory value item nrv cost lc- total inv