Which of the following transactions would not result in a temporary difference between pretax financial income and taxable income? * O Depreciation expense O Product warranty costs O Contingent liabilities O Payment of premiums for life insurance

Which of the following transactions would not result in a temporary difference between pretax financial income and taxable income? * O Depreciation expense O Product warranty costs O Contingent liabilities O Payment of premiums for life insurance

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter3: Taxes On The Financial Statements

Section: Chapter Questions

Problem 8P

See similar textbooks

Related questions

Q: What types of ordinary and statutory income do not constitute assessable income?

A: Ordinary Income is that income which is taxable at ordinary rates or earned from working. Like…

Q: Regarding the taxation of life insurance policies, which of the following is NOT true? Select one:…

A: Life insurance is referred to as a contract between you and the insurance company. In general,…

Q: Which of the following is not included in the MHE, or PITI, payment? O Principal O Points O Interest…

A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…

Q: Sometimes a temporary difference will produce future deductible amounts. Explain what is meant by…

A: The future deductible amount caused by temporary difference means that the taxable income can be…

Q: Is all accounting income taxable? is there any accounting income that is not taxable? Please Explain…

A: Accounting income is the profit left over after all applicable expenses have been deducted from…

Q: Which of the following may not form part of the regular itemized deductions from the gross income? *…

A: Itemized deductions: These are the Expenses which are deductible from the gross total income. The…

Q: What are the different kinds of payments that are taxable or non taxable under the FU

A: Payments that are non taxable / exempt under the FUTA are as follows dismissal payments wages…

Q: Life insurance premiums shall be reported as a deductible expense for financial reporting purposes…

A: The outlay which is an ordinary outlay and helps in the normal revenue generation of the business is…

Q: An income not yet paid is not yet to be reported as income for the taxable year. Group of answer…

A: As per accrual method an income is reported as and when it is earned and not when it is paid.…

Q: Deductions from gross income are subtracted from gross income to derive taxable net income. TRUE OR…

A: Gross income is the aggregate total income that is received by a taxpayer that is not tax-exempt…

Q: Taxable income is ????????????????? why not gross income less deductions????

A: Taxable Income is income on which tax is payable by the taxpayer. It can be calculated as follow…

Q: computing the taxable income of a compensation income earner, what is deducted from his total…

A: Taxable compensation income derived from deducted all deductions from taxable income .

Q: In a case of low value asset exemption, rent paid in advance by the lessee should be treated as O…

A: Rent paid in Advance by the lessee shall be classified as Prepaid Rent.. Option Prepaid Rent is…

Q: Which of the following would not be considered a general long term liability? Select one: a. Long…

A: Short term obligations are the obligations that have to be paid within a year. whereas, long term…

Q: Deductibles are not used in which of the following type of insurance?

A: Deductibles in insurance: The deductibles is an expense the insured have to pay in before the time…

Q: Elements of gross income

A: Option B is wrong because realized income is an element of gross income. Option C is wrong because…

Q: ayment made by the lessee to the lessor? A. None of the above B. If the advance payment representing…

A: A lessee is someone who rents property or land from a lessor. The lessee, sometimes known as the…

Q: Which of the following is not a liability?a. Income taxes payableb. Accrued warranties payablec.…

A: Liability are the obligations which are to be paid in current period or in future.

Q: statements is true? A.Deductions are not allowed unless there is a specific law authorizing the…

Q: Will the death of the principal debtor convert, decrease or nullify the substantive right of the…

A: Principal Debtor describes the natural individual or legal entity whose name appears on the…

Q: How do defreinciate between a accured income and prepaid income

A: Introduction: Accruals: Transactions recorded in the books but not yet received or paid cash called…

Q: the purpose of grossing up of Interests in calculating taxable income from Int

A: Taxable income refers to the sum value of money gained by an entity on which the government implies…

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: Give

Q: Which of the following creates a taxable temporary- difference?

A: Introduction: A transitory difference is the difference between an asset's or liability's income…

Q: Question 10 Which of the following is not part of compensation income? Vacation and sick leave pay…

A: Compensation income includes the payment received by the employee in exchange for service provided…

Q: Examples of items that are adjusted directly against equit rather than being included as part opf…

A: Stockholders’ equity: The claims of owners on a company’s resources, after the liabilities are paid…

Q: Which of the following is a characteristic of a current liability? A. It is an avoidable…

A: Liabilities are classified into two types. 1. Current liabilities ; which are expected to be paid…

Q: Which of the following differences would result in future taxable amounts? * a. Expenses and losses…

A: If Expenses or losses that are deductible before they are recognized in financial income, it would…

Q: types of payments that are taxable/not taxable for FUTA?

A: Federal unemployment tax is a tax paid by the employers to the employees who have left the company…

Q: Which if the following is not an inclusion in gross income?

A: Gross income is an income from all sources including returns , discounts and…

Q: If during the current year, taxable profit is greater than accounting profit and the difference is a…

A: In many countries, as per their laws companies are required to maintain two sets of books (Financial…

Q: Interest revenue need not be added to the gross income to compute for the total income.

A: Gross income and net income are two concepts associated with the accounting that helps to identify…

Q: ll require the use of current assets. Payment of the obligation must be probable. The compensation…

A: The correct option is given as,

Q: Which of the following is not a ground for the extinguishment of an obligation? O Condonation or…

A: Following is the correct answer

Q: In the final settlement, of the contingent consideration, which of the following statements is…

A: I. Contingent consideration classified as equity the amount shall be measured upon settlement and…

Q: Which of the following is usually not an accrued liability? Select one: a. Notes payable b. Taxes…

A: Accrued liability refers to the amount of liability that represents the expenses for the current…

Q: Income of on-line sellers are generally taxable. True or false?

A: online seller buys products and then sells them to generate profit. Online sellers can sell just…

Q: Which among the following suits best for Unearned revenue? a. Liability b. Expense c. Revenue d.…

A: Unearned Revenue: Unearned Revenue means money received from the customer in advance for the service…

Q: What is the permanent difference between pretax accounting income and taxable income?

A: A permanent difference is a difference between pretax financial income and taxable income in an…

Q: Annuity payments received by a taxpayer represent a part which is taxable and non taxable. Which of…

A: Annuity means a series of payments being paid or received in particular period of time and a fixed…

Q: Explain the difference between pretax financial income and taxable income.

A: Pretax financial income: Income that is computed based on the records and documents presented by an…

Q: What is generally not a deductible business expense on Schedule C?

A: The sole proprietor type businesses are not allowed to get deduction under Schedule C.

Q: Which of the following is not affected by a change in interest expense? a. gross margin b.…

A: The question is based on the concept of Financial Accounting.

Question

Which of the following transactions would not result in a temporary difference between pretax
financial income and taxable income? *
O Depreciation expense
O Product warranty costs
O Contingent liabilities
O Payment of premiums for life insurance

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Correct option:

VIEW

Explanation

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Which of the following creates temporary difference between financial and taxable income? * Interest on treasury debt securities Accelerated depreciation on plant and equipment O Fines from vilation of law Premiums paid for officer's life insurance (comapny is beneficiary)
When the temporary differences result to financial income higher than taxable income, they are known as taxable temporary difference or future deductible amounts. a. TRUE b. FALSE
Which of the following creates a taxable temporary- difference? I. Prepaid expenseII. Estimated liabilities Ill. Unearned incomeIV. Installment receivable Choices: I, II, and IV II and IV I, II and III I and IV
What is the correct treatment of advance payment made by the lessee to the lessor? A. None of the above B. If the advance payment representing loan is intended to be applied to unpaid rent, the amount is part of the debtor/lessor’s taxable income at the time of receipt of said amount. C. If the advance payment represents security deposit, the amount is part of the lessor’s taxable income. D. If the advance payment represents loan, the amount is part of the lessor’s taxable income.
What is the permanent difference between pretax accounting income and taxable income?
Annuity payments received by a taxpayer represent a part which is taxable and non taxable. Which of the following statement is correct? O Return of premium is taxable O Return on premium is non-taxable Both statements are correct O Both statements are not correct
Which of the following is usually not an accrued liability? Select one: a. Notes payable b. Taxes payable C. The answer does not exist d. Wages payable e. Interest payable Jump to...
Question 6: Which of the following is not a voluntary deduction from gross earnings? Answer: A. O Union dues B. O State disability insurance C. O Payroll deduction IRA D. Cafeteria plan
Which of the following is not a from AGI deduction? A. The exclusion of an item of gross income B. Itemized deductions, if taken C. Standard deduction, if taken D. The qualified business income deduction
Classify the following items that may cause discrepancy between accounting profit and taxable income, into the following types of differences. Also, provide an explenation why that is their classification. A. Non-deductible expenses B. Non-taxable revenues C. Deductible temporary difference D. Taxable temporary difference Deductible insurance premiums paid in excess of insurance expense reported for financial reporting. Provision for loss on pending lawsuit expected to be settled during the next reporting period. Insurance premiums paid on life insurance policy where the entity is designated beneficiary. Impairment loss attributed to goodwill. Warranty expense reported for financial reporting purposes in excess of actual costs of repairs done during the period.
Which of the following situations does not base an accounting measure on a present value? Prepaid insurance , leases, pensions or sinking funds
15. Related to insurance, what is a deductible and how does it work?