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- when multiplying companys tax rate with any firms accounting income , the result is always different with income tax expense . why ??Why do companies choose to accelerate depreciation on their tax return and not on their income statement? a. to avoid paying taxes b. to postpone paying taxes c. to match their GAAP financial statementsWhich of the following is false regarding book and market values? Select one: O a. Financial managers should rely on book values, and not market values, when analyzing the firm's tax liability. O b. Book value is an accounting summary of value and is inferior to market value as a source of current information regarding the true value of the firm. c. Market value always exceeds book value. O d. The market value of fixed assets is often difficult to determine.
- EBITD is equivalent to profits after taxes. true or false?Why company tax rate is always different from company accounting income?A reduction in the statutory tax rate would most likely benefi t the company’s:A . income statement and balance sheet.B . income statement but not the balance sheet.C . balance sheet but not the income statement.
- A company determines that it is more likely than not that a portion of a deferred tax asset will not be realized. Due to the value of the beginning of the period balance, this determination caused a valuation allowance account to decrease during the current period. This situation will cause Income Tax Expense to decrease. O True O FalseWhich cost flow assumption must be used for financial reporting if it is also used for tax reporting? Multiple Choice LIFO. FIFO. Weighted-average. Any assumption can be used regardless of the tax reporting.A company records an unrealized profit on short-term securities. This would result in what type of difference and in what type of deferred income tax? Type of Difference /deferred tax Select one: a.Permanent / Liability B.Temporary / Liability c.Temporary / Asset d.Permanent / Asset
- 1. What is the effect of financial distress and taxation on gearing? A. Both constrain gearing B. The tax constrains gearing; financial distress pushes for increased gearing C. The tax pushes for increased gearing; financial distress constrains gearing D. Both push for increased gearingFollowing IFRS, which statement is false? Group of answer choices The revaluation surplus account is a specific account reported as an unrealized gain in the statement of comprehensive income. If a long-term operating asset's fair value decreases in subsequent accounting periods, after an earlier write-up, the firm reduces the revaluation surplus if it exists. If the revaluation initially increases the long-term operating asset's carrying value, the firm records the difference between the carrying value and the fair value (the unrealized gain) in the revaluation surplus account. The revaluation surplus account is a specific account reported in other comprehensive income (OCI) in the statement of comprehensive income.The Adjusted Present Value approach to valuation uses Interest Tax Savings to account for: a. The unlevered cost of equity. b. Property taxes. c. Dividends that could have been paid to common stockholders. d. Changes in capital structure over the planning period. e. None of the above.