If an Expense Is Reported on the Tax Return Before

question 45

Multiple Choice

If an expense is reported on the tax return before it is reported on the financial accounting books

• A)the result is a deferred tax asset
• B)the result is a deferred tax liability
• C)there could be either a deferred tax asset or liability
• D)there is no effect as this is not a timing difference

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Definitions:

Corporate Raiders

Investors who buy a large stake in a corporation with the intention of taking over its management and restructuring it for profit.

Executive Privileges

Special rights and privileges that allow presidents and other high-level officials to resist certain subpoenas and other interventions by the legislative and judicial branches of government.

Stock Price

The current price at which a share of stock can be bought or sold in the market.

Corporate Raiders

Investors who acquire a large stake in a corporation to effect significant changes, often with the goal of increasing shareholder value.