he deferred income tax liability: Top of Form Multiple Choice Is recorded whether or not the difference between taxable income and financial accounting income is permanent or temporary. Results from the income tax expense reported on the income statement differing from the amount of income taxes payable to the government. Is never recorded. Is a contingent liability. Can result in a deferred income tax asset.

Q: e journal entry required to record the tax effect of the revaluation. a. None of answers given b.…

A: Revaluation has been the process of adjusting a fixed asset class book value to its own current…

Q: As ITA 3(b) indicates Taxable Capital Gains exceed Allowable Capital Losses, which of the following…

A: Solution:-ITA 3(b) - Capital gains tax occurs if the previous year's capital gains tax exceeds the…

Q: TRUE OR FALSE? 1st statement: Interest income must be included in the computation of gross income if…

A: Gross Income: The entire earnings a person obtains before taxes and other deductions are referred to…

Q: Crane Inc. reports the following incomes (losses) for both book and tax purposes: Accounting Income/…

A: Answer:- Journal entry:- A business's accounting records can contain information about a transaction…

Q: What is the income that will not be taken into account in the determination of the Financial Profit…

A: This question deal with the answer of which income will not be taken into account while determining…

Q: PLEASE ANSWER ALL QUESTIONS IN BOTH 1 AND 2 PLEASE. 1. Some accountants believe that deferred taxes…

A: Temporary differences are defined as differences between the carrying amount of assets and…

Q: Which of the follwing types of tax may not be shifted a. Percentage Tax b. Excise Tax c. Income Tax

A: The answer is Option c. Income Tax Income tax cannot be shifted.

Q: A valuation allowance would exist as a contra account to the deferred tax assets if it is:…

A: In the financial accounts of the company, taxes that are paid in advance but have not yet been paid…

Q: Discontinued operations, and unusual gains and losses are both reported net of tax in the income…

A: Lets understand the basics.Discontinued operation is a operation which is closed by the business. In…

Q: taxable income

A: Income tax is payable by every person that crosses the tax-exempted threshold. However, various…

Q: Schedule M-1 of Form 1120 is used to reconcile financial net income with taxable income. reported on…

A: M-1 of Form 1120 is used to reconcile financial net income with taxable income reported on the…

Q: Deferred income taxes result from: a. The fact that bond interest is deductible in the computa-tion…

A: Option C is correct.

Q: The entry to recognize that a portion of a deferred tax asset would more likely than not be not…

A: Income tax actual paid and income tax expenses some time differ because of deferred income…

Q: The following statements are true concerning the allowance method except: Oit does not always match…

A: The allowance approach is a form of bad debt accounting that involves the estimation of…

Q: An item that is considered a nondeductible item in taxable income is recognizing estimated bad debts…

A: Non deductible item in taxable income is an item which will not be considered for deduction while…

Q: Provide two examples of expenditures that are typically not allowable for tax deductions but are…

A: Introduction: A tax-deductible cost is one that is "ordinary, essential, and reasonable" and…

Q: Statement 1: Life insurance premiums shall be reported as a deductible expense for financial…

A: Tax is the liability that person owes to the government.

Q: Taxable income differs from financial accounting income in that It requires a change in the…

A: Taxable Income The base income used to calculate taxes is known as taxable income. It may include…

Q: Which of the following differences between financial accounting and tax accounting ordinarily…

A: The concept of Deferred Tax arises, due to the timing difference between income as per the…

Q: A net operating loss occurs when tax-deductible expenses exceed taxable revenues. Tax laws permit…

A: Definition:   Net Operating Loss Carryforward: The net operating loss is considered a negative…

Q: d. either current or expected future tax laws

A: Taxes are the amount of dues or liabilities that need to be paid by the individual to the…

Q: Which statement is false? a) Deferred taxes are the product of temporary difference in the…

A: Taxes refers to the amount that is charged by the government to individuals and organizations on the…

Q: 5) How should companies appropriately account for the tax benefit due to a loss carryforward? ( O…

A: When a company suffers net operating loss in the current year, it can set off this loss against the…

Q: When DTA reverses, income tax payable is reduced, while when DTL reverses, income tax payable is…

A: Temporary differences are differences between book income and taxable income of the business. These…

Q: All items of gross income, legitimate or not, are taxable unless exempted by law or treaty.…

A: c. Only statement 1 is true

Q: What are the two objectives of accounting for income taxes O Deferred Tax Assets Deferred Tax…

A: The answer is as fallows

Q: Explain three main reasons expenses may not be deductible for income tax/corporation tax purposes.

A: Business expenses: These are costs you incur while operating your business. Expenses are recorded on…

Q: he deferred tax consequence attributable to a deductible temporary difference and operating loss…

A: Solution: Deferred tax assets are created from those temporary differences which are future…

Q: There are three general views regarding interperiod income tax allocation: no allocation, partial…

A: Income tax is a type of tax imposed by governments on income generated by businesses and limits…

Q: Deferred tax assets and deferred tax liabilities represent the tax effect of the temporary…

A: A deferred tax asset represents a financial benefit, while a deferred tax liability indicates a…

Q: Financial Assets representing a contractual right to receive cash in the future. Financial Liability…

A: Financial asset, is an asset that gives contractual right to an entity, to receive cash or another…

Q: Which of the following may be a current liability? Withheld Income Taxes Deposits Received from…

A: The liabilities are classified as current liabilities and long term liabilities.

Q: A) Interest paid or accrued to purchase or carry tax-exempt investments is not deductible. B)…

A: Investment Income Under normal circumstances investment income can't be used for the tax deduction…

Q: . As distinguished from deductions, tax credit is a. A deduction from gross sales/receipts b. A…

A: Tax deductions are the amount which can reduce from taxable income. After such deduction, remaining…

Q: Which one of the following represents the tax payable? a. Tax payable is the balance of the total…

A: Tax is the amount that is to be paid on the income by individuals, firms and entities to the…

Q: Intraperiod tax allocation relates income tax expense to the items that affect the amount of tax. O…

A: Income tax is calculated on income of each year in total. Intraperiod means within one period.

Q: 43. True or False. If the debt is canceled due to services rendered by the debtor, the basis of tax…

A: There are cases and instances in which a debtor renders services and in lieu of these services the…

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.