Isaac Inc. began operations in January 2021. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments.
In 2021, Isaac had $703 million in sales of this type. Scheduled collections for these sales are as follows:
2021 $ 88 million
2022 142 million
2023 143 million
2024 178 million
2025 152 million
$ 703 million
Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses, what deferred tax liability would Isaac report in its year-end 2021 balance sheet?
