The Measurement of Deferred Tax Liabilities and Assets Under International

question 27

Multiple Choice

The measurement of deferred tax liabilities and assets under international accounting standards requires the use of

• A) current-year tax rates;use of future-years' tax rates even though enacted is prohibited.
• B) currently-enacted tax rates for future years..
• C) currently-enacted tax rates for future years and future tax rates that have been announced by the government but have not yet been formally enacted into law
• D) tax rates in effect when the temporary difference originated.

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Definitions:

Dischargeable

Referring to debts that can be eliminated or forgiven through legal processes, such as bankruptcy.

Domestic Support Obligations

Financial responsibilities, such as alimony or child support, owed by one individual to another as ordered by a court.

Unsecured Note

A financial instrument that represents a loan not backed by collateral, typically entailing higher risk for the lender.

Entitled to Priority

Entitled to priority refers to a situation where certain claims, such as debts or interests, are given precedence over others in the event of a bankruptcy or liquidation.