If Total Liabilities Increased by ¥26,000 During a Period of Time

question 223

Multiple Choice

If total liabilities increased by ¥26,000 during a period of time and equity decreased by ¥9,000 during the same period, then the amount and direction of the period's change in total assets is a(n)

• A) ¥26,000 increase.
• B) ¥35,000 increase.
• C) ¥17,000 decrease.
• D) ¥17,000 increase.

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Definitions:

Tax Rate

The percentage at which an individual or corporation is taxed by the government.

Income Tax Expense

The total amount of income tax a company is required to pay to tax authorities, as calculated based on taxable income.

Deferred Tax Liability

A tax obligation that a company owes but is not due to be paid until a future period, often resulting from timing differences in recognizing income and expenses for tax and accounting purposes.

Deferred Tax Asset

A deferred tax asset is an accounting term used to describe a situation where a business has paid more taxes or anticipates paying more taxes than it is currently liable for.