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Carry-forward tax losses create: a. A deductible temporary difference and therefore a deferred tax asset in that the company will pay more tax on future taxable profits.   b. A taxable temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits   c. A deductible temporary difference and therefore a deferred tax liability in that the company will pay more tax on future taxable profits.   d. A deductible temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits

Carry-forward tax losses create: a. A deductible temporary difference and therefore a deferred tax asset in that the company will pay more tax on future taxable profits.   b. A taxable temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits   c. A deductible temporary difference and therefore a deferred tax liability in that the company will pay more tax on future taxable profits.   d. A deductible temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Carry-forward tax losses create:

a. A deductible temporary difference and therefore a deferred tax asset in that the company will pay more tax on future taxable profits.

 

b. A taxable temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits

 

c. A deductible temporary difference and therefore a deferred tax liability in that the company will pay more tax on future taxable profits.

 

d. A deductible temporary difference and therefore a deferred tax asset in that the company will pay less tax on future taxable profits

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