When temporary differece will result in taxable amountin future yearsa. A deferred tax liability is recognized in the currentyear.b. A deferred tax asset is recognized in the current year.c. A deferred tax asset may be recognized in the currentyear if certain conditions are met.d. A deferred tax liability may be recognized in thecurrent year if certain conditions are met.

Deferred tax is the amount of tax owe by or to the tax payer arises out of the temporary differences…

Answered: a temporary difference

Business

Accounting

a temporary difference

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 36P

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If during the current year, taxable profit is greater than accounting profit and the difference is a temporary difference, a deferred tax liability is recognized at the end of the current year. a deferred tax liability will be recognized in future years. deferred tax asset will be recognized in future years. a deferred tax asset is recognized at the end of the current year.
True/False A deferred tax liability represents the increase in taxes payable in future years as a result of taxable temporary differences existing at the end of the current year.
Recognition of tax benefits in the loss year due to a NOL carry back involves: O The establishment of an income tax refund receivable. Only a note to the financial statements. The establishment of a deferred tax liability. O The establishment of a deferred tax asset.
Four Independent situations are described below. Each Involves future deductible amounts and/or future taxable amounts produced by temporary differences: Taxable income Future deductible amounts Future taxable amounts Balance(s) at beginning of the year: Deferred tax asset Deferred tax liability a. Income tax payable currently. b. Deferred tax asset-ending balance. c. Deferred tax asset-change. d. Deferred tax liability-ending balance. 1 $ 88 16 e. Deferred tax liability-change. f. Income tax expense. 2 ($ in thousands) Situation 2 2 $ 220 16 8 The enacted tax rate is 25% Required: For each situation, determine the following: Note: Enter your answers in thousands rounded to one decimal place (l.e. 1,200 should be entered as 1.2). Negative amounts should be indicated by a minus sign. Leave no cell blank, enter "0" wherever applicable. Situation 3 $ 204 20 16 3 10 2 4 $ 272 20 32 4
Recognition of tax benefits in a loss year due to a loss carryforward requires A) the establishment of a deferred tax liability. B) only a note to the financial statements. OC) the establishment of an income tax receivable. OD) the establishment of a deferred tax asset.
For each item listed below, indicate whether it involves a: a. permanent difference. b. temporary difference that will result in future deductible amounts (giving rise to deferred tax assets). c. temporary difference that will result in future taxable amounts (giving rise to deferred tax liabilities). 1. Rent is collected in advance from a tenant. Rent is taxable when received. 2. Warranty costs are accrued at the time of sale for accounting purposes, but are not deductible until paid for income tax purposes. 3. Interest revenue is recorded on municipal bonds. 4. Installment sales are recognized at the point of sale for accounting purposes, but when the cash is received for income tax purposes. 5. A loss contingency is expensed for accounting purposes. The…
Recognition of tax benefits in the loss year due to a NOL carry back involves:
A deferred tax liability or asset that is related to an asset or liability shall be classified in the statement of financial position based on the expected reversal date of the temporary difference
i. Compute taxable income for 2018. ii. Compute the deferred taxes at December 31, 2018, that relate to the temporary differences described above. Clearly label them as deferred tax asset or liability.
A deductible temporary difference leads to the payment of: Select one: A. less tax in the future and gives rise to a deferred tax asset. B. less tax in the future and gives rise to a deferred tax liability. C. more tax in the future and gives rise to a deferred tax asset. D. more tax in the future and gives rise to a deferred tax liability.
Four independent situations are described below. Each involves future deductible amounts and/or future taxable amounts produced by temporary differences: Taxable income Future deductible amounts Future taxable amounts Balance(s) at beginning of the year: Deferred tax asset Deferred tax liability. The enacted tax rate is 25%. a. Income tax payable currently. b. Deferred tax asset-ending balance. c. Deferred tax asset-change. d. Deferred tax liability-ending balance. e. Deferred tax liability-change. f. Income tax expense. 1 ¹ 1 2 ³ $132 $264 $292 16 | ($ in thousands) Situation 2 16 2 8 Required: For each situation, determine the following: (Enter your answers in thousands rounded to one decimal place (i.e. 1,200 should be entered as 1.2). Negative amounts should be indicated by a minus sign. Leave no cell blank, enter "0" wherever applicable.) Situation 20 16 3 21 2 4| $404 20 76 4 4
True or false. A favorable temporary tax - book difference is so named because it causes taxable income to decrease relative to book income in the current year.