Deferred income taxes result from: a. The fact that bond interest is deductible in the computa-tion of taxable income. b. Depositing income taxes due in future years in a specialfund managed by an independent trustee.c. Differences between certain revenue and expense itemsrecognized in financial statements but not in income taxreturns.d. The inability of a bankrupt company to pay its incometax liability on schedule.

Q: Unrealized los

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

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: A company has only one deductible temporary difference due to the use of the current expected credit…

A: Deferred tax liabilities are the amounts of income taxes payable in future periods in respect of…

Q: Which of the following statements accurately describes the impact of accounting for bad debts on…

A: This question pertains to the impact of accounting for bad debts on taxes. Bad debts occur when a…

Q: The carry forward periods for losses varies with the type of loss. Briefly describe the carry…

A: A tax loss carry forward is a provision that allows to the taxpayer to move a loss of tax to coming…

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: Under IFRS when a change in the tax rates is enacted I.    Companies should record its effect on…

A: Under IFRS, companies report the effect of changes in tax rates on deferred tax accounts in the…

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: Which of the following refunds is not subject to income tax a, Local tax expense b.Special…

A: Answer: Th refund which is not subject to income tax are those amount for which earlier deduction…

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: When assessing realizability of deferred tax assets, management must consider positive and negative…

A: The objective of the question is to identify which of the given options would not be considered as…

Q: Accounting Topic: Labor cost accounting Fisheries Manufacturing Co. charges factory overhead to…

A: The predetermined overhead rate is used to apply factory overhead to production.

Q: No deductions shall be allowed where the transaction is between “related taxpayers” under Sec. 36(B)…

A: Solution Concept As per the provision of the Tax Code The interest expense in not allowed for…

Q: For tax purposes where interest expense on margin loan is deductible for investment purposes , can…

A: To determine the prorated deductibility of interest expense on a margin loan, you need to understand…

Q: contingency that need not be disclosed in the financial statements

A: Contingency is the probable obligation or receivable that may arise in future which depends on the…

Q: The tax law requires that capital gains and losses be separated from other types of gains and…

A: Short-term capital lose are allowed to be setoff against both long-term gain and short-term…

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: When a company pays taxes that were previously recorded as a deferred tax liability, the temporary…

A: The objective of the question is to understand the impact on the temporary difference when a company…

Q: a) What was the cost of raw materials purchased during the year?  b) What was the direct-labour cost…

A: Since there is more than 3 question asked, SME is going to answer only 3 subparts only.

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: hy do companies choose to accelerate depreciation on their tax return and not on their income…

A: Depreciation is the decrease in value of assets and in accerlated method there is more depreciation…

Q: Which of the following is true

A: The correct answer is 2. Investments in stocks of other companies accounted for using the equity…

Q: While earnings on assets held in a Tax Free Savings Account (TFSA) will not be taxed while the…

A: False

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: Which of the following items isreported net of related income taxes?a. Gain or loss from…

A:

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: TRUE OR FALSE? 1st statement: MCIT will be imposed if the company's business operation resulted in…

A:

Q: How would the transactions be reconciled if the bad debt allowance is changed to a write-off but the…

A: Introduction: This question stated that the company made the provision or provided for allowance for…

Q: compute the present value of interest and the principle amount

A: Present value is the sum of present value of future cashflow discounted with the required rate of…

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…

Q: The Cohan rule has to do with: 1) Tax accounting methods 2) Debts of another taxpayer 3)…

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

Q: Recognition of tax benefits in the loss year due to a NOL carry back involves: OThe establishment of…

A: Deferred tax asset: When book profits of entity is less than taxable profits it results in deferred…

Q: Accounting profit is O A. The The profit or loss is for a period determined before deducting in…

A: There are two types of income. One is accounting income, and the other is taxable income. Tax…

Q: A deferred tax account is classified on the balance sheet as: A net noncurrent amount A net current…

A: Introduction: Balance sheet: All Assets and liabilities are shown in Balance sheet. It tells the net…

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.