Which of the Following Is Correct with Respect to Generally

question 119

Short Answer

Which of the following is correct with respect to generally accepted accounting principles?
Public and private businesses can no longer use generally accepted accounting principles.
They are used in many foreign countries but not in Canada.
Public companies in Canada have moved away from using generally accepted accounting principles and have adopted adopted International Financial Reporting Standards (IFRS).
Private companies must use the new International Financial Reporting Standards (IFRS).
None of these statements are correct.

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Definitions:

Income Tax Expense

Income tax expense represents the amount of money a company or individual owes to the government based on their taxable income.

Deferred Tax Liability

A tax obligation that a company owes in the future due to temporary differences between its taxable income and its accounting earnings.

Deferred Tax Asset

An accounting item on the balance sheet that represents a future tax payment obligation to the IRS, which results in reduced taxes payable in future periods.

Income Tax Liability

The amount of tax that an individual or corporation owes to the government based on their income earnings for the fiscal year.