What Is an "Originating Difference

question 30

Multiple Choice

What is an "originating difference"?

• A)The net carrying amount of a capital asset or capital asset class for tax purposes in Canada.
• B)A temporary item that narrows that gap between accounting and tax values of an asset or liability.
• C)A temporary item that widens the gap between accounting and tax values of an asset or liability.
• D)The terminology used for depreciation of capital assets under for tax purposes in Canada.

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Definitions:

Consolidation Purposes

The process in accounting where the financial statements of a parent company and its subsidiaries are combined to present as one entity for reporting.

Local GAAP

Refers to the Generally Accepted Accounting Principles that are specific to a country, governing how financial statements should be prepared and reported.

U.S. GAAP

The accounting standards and principles specifically used within the United States to guide the preparation of financial statements.

Currency Balances

Refers to the amounts of foreign currencies held by a company at any given time, which can fluctuate due to changes in exchange rates.