How is a business activity distinguished from an investment activity? why is this distinction important for the purpose of calculating federal income taxes? What types of losses may potentially be characterized as passive losses?

Q: Unrealized los

A: Meaning: Deferred tax is defined as tax effect due to timing difference i.e. difference between…

Q: In which situation does the tax depreciation allow the firms to defer paying income taxes?

A: Deferment of income tax liability is also called as Deferred Tax Liability. It means tax liability…

Q: Which of the following best describes the distinction between expenses and losses? Losses are…

A: Expenses :  Expense means the cost which a company incurs to earn revenue. For example payment of…

Q: Account for corporate income taxes; explain the effects of these taxes onbefore-tax profits and…

A: Corporate income taxes are taxes paid by companies on their income

Q: How can we determine Corporate Taxes?

A: Definition: Corporate taxes are the source of income for the government or the nation which is…

Q: What is the depreciation method that is used for tax accounting purposes? How is it different than…

A: Accelerated depreciation method:

Q: Which of the following creates temporary difference between financial and taxable income? * Interest…

A: Temporary differences are differences between pretax book income and taxable income that will…

Q: 1. Explain how value-added tax (VAT) works and its advantages and disadvantages from businesses,…

A: Disclaimer: "Since you have asked multiple questions in a single question we answered first question…

Q: What is the difference between income which is "realized" and income which is "recognized"?  Which…

A: Financial accounting requires to report all the income and expenses on the books and compute the…

Q: The faster an asset can be depreciated, according to IRS rules, the greater a company's after-tax…

A: Depreciation is a process in which, when a business buys or develops an asset, the tax treatment for…

Q: Which of the following is not an income for income tax purposes?

A: Assuming the question related to tax in Phillipines ---…

Q: . What is the possible treatment for tax purposes of a net operating loss? What is the proper…

A: Net operating loss: When the level of income is less than the expenses for a given or a considered…

Q: Why should executory contracts be disclosed in the financial statements? Group of answer choices…

A: Executory contracts are contracts under which neither party has performed any of its obligations or…

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: Which of the following payment is a capital expenditure and not deductible under profits tax?

A: 1(a)  Payment to a departing employee agree for not competing with the company.   1(b)  1,3 and 4…

Q: Which of the following is not deductible from business income? Group of answer choices Casual…

A: Business income is earned revenue that includes all money generated by an entity's operations.…

Q: The tax treatments of assets affects the risk structure of assets True False

A: The composition of a company's asset helped in determining how the balance of long-term credits and…

Q: explain what a growing balance in the deffered income tax liability is likely to indicate about a…

A: This question deals with the IFRS 12 "Deferred tax" As per IFRS,  When there is temporary taxable…

Q: How are deferred taxes calculated? What determines if the company has a deferred asset or a deferred…

A: Deferred tax is a fictitious asset or liability that reflects company income taxation on a premise…

Q: How is tax accounting different from financial accounting?

A: Accounting: It can be defined as the process of summarizing and recording the company’s financial…

Q: Which of the following need not be disclosed in the financial statements or the notes thereto?…

A: A contingent liability is a liability that may arise as a result of the outcome of a future event…

Q: What are the possible treatments for tax purposes of anet operating loss? What are the circumstances…

A: Net operating loss: When the level of income is less than the expenses for a given or a considered…

Q: a. For reporting purposes, management prefers higher profit; for tax purposes, lower taxable income…

A: PLEASE LIKE THE ANSWER, YOUR RESPONSE MATTERS  Identify the best depreciation method: • For the…

Q: l financing affects tax liability

A: Step 1 Debt financing is well regulated under U.S. tax law. Businesses can deduct interest payments…

Q: What is depreciation and amortization? What's the difference? It is an accounting concept that has…

A: Depreciation is a charge to account for a reduction in the value of a capital asset arising because…

Q: How does depreciation give tax benefits? What are the advantages of Internal Financing?

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

Q: What is the difference in the tax treatment of interest anddividends paid by a corporation? Does…

A: Introduction: Usually, dividend is nothing but, sharing a portion of profits of the corporation, as…

Q: hich of the following may not be an effect of VAT on the accounting records of a company?   The…

A: VAT is the value added tax which is applied to all sales of services and imports, as well as to the…

Q: Can you explain the benefit principle and ability to pay approach with regard to tax equity. Which…

A: Benefit principal theory of taxation - In this theory citizens of a country are asked to pay tax…

Q: Why are disclosures about deferred taxes useful to identify the ways in which publicly-traded…

A: Here discussion about the disclosure about the benefits which are availed in the form of relief in…

Q: We tax net income? What economic distortions would occur if we taxed gross receipts?

A: Gross income is the income to the company or an individual after operating activities or providing…

Q: Corporate taxable income is based on an income statement that is similar to income statements…

A: Taxable income is the measurement of income which is used to calculate the amount of tax that needs…

Q: Briefly explain how tax loss carryback and carryforward procedureswork.

A: Loss carryback is a situation in which business is having operating loss in this year and it want to…

Q: Which depreciation method is most common for financial reporting? Which depreciation method is most…

A:

Q: how company's financial statement reflects the potential tax avoidance? For example?

A:

Q: The form of employees compensation ir relevant to tax deductibility of the firm true? or false?

A: The correct answer for the above mentioned question is given in the following steps for your…

Q: What are the two particular business structures have evolved in response to liability issues and tax…

A: In response to the issue of liability and tax treatments the two business structures that were…

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

A: Net Operating Loss Carry forward:The net operating loss is considered as negative taxable income.…

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.