When a company reports a deferred tax asset it means that the company will receive a tax benefit in the future. true or false
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When a company reports a
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- The definition of gross income in the tax law is: All items specifically listed as income in the tax law All cash payments received for goods provided and services performed All income from whatever source derived All income from whatever source derived unless the income is earned illegallyTRUE OR FALSE? An excess tax depreciation will result to a deferred tax liability.When certain expenditures result in tax credits that directly reduce taxes, the companywill most likely record:A . a deferred tax asset.B . a deferred tax liability.C . no deferred tax asset or liability.
- A company reduces a deferred tax asset by a valuation allowance if it is probable that it will not realize some portion of the deferred tax asset true or falseA net operating loss occurs when tax-deductible expenses exceed taxable revenues. Tax laws permit the net operating loss to be used to reduce taxable income in future profitable years. How are loss carryforwards recognized for financial reporting purposes?Deferred tax assets and deferred tax liabilities represent the tax effect of the temporary difference between the financial carrying value of an asset or liability and its tax basis. True or False True False
- What is an unrecognized tax benefit and how does it affect a company's current income tax expense?A deferred tax liability (or asset) is described as the tax effect of the temporary difference between the financial statement carrying amount (book value) of an asset or liability and its tax basis. Explain this tax effect of the temporary difference. How might it produce a deferred tax liability? A deferred tax asset?A company receives advance payments from customers that are immediately taxable butwill not be recognized for accounting purposes until the company fulfi lls its obligation.Th e company will most likely record:A . a deferred tax asset.B . a deferred tax liability.C . no deferred tax asset or liability.
- Deferred tax assets and deferred tax liabilities represent the tax effect of the temporary difference between the financial carrying value of an asset or liability and its tax basis. Is this True or False? I think it's True but I'm not sure.A net operating loss (NOL) carryforward creates: A-a deferred tax liability that should be classified as current liability B- a deferred tax asset that represents future tax benefit that can offset future taxable income O A O B Drouinunexplain how deferred tax liabilities and assets are created and the factors that determine howa company’s deferred tax liabilities and assets should be treated for the purposes of fi nancialanalysis;