When Assessing Realizability of Deferred Tax Assets, Management Must Consider

question 121

Multiple Choice

When assessing realizability of deferred tax assets, management must consider positive and negative evidence. All of the following would be considered positive evidence except ________.

• A) taxable income in prior carryback year(s) if carryback is permitted under the tax law
• B) future reversals of existing taxable temporary differences
• C) unsettled circumstances that could adversely affect future operations
• D) an excess of appreciated asset value over the tax basis of the entity's net assets

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Definitions:

Mathematics

The abstract science of number, quantity, and space, either as abstract concepts (pure mathematics) or as they apply to other disciplines such as physics and engineering (applied mathematics).

Spatial Perception

The ability to perceive and understand the relative positions of objects in space.

Long-Term Memory

The aspect of memory responsible for storing information over extended periods, ranging from days to a lifetime.

Cytoskeleton

A network of protein fibers within a cell that gives it shape, offers support, and facilitates movement.