Which of the Following Temporary Differences Results in a Deferred

question 21

Multiple Choice

Which of the following temporary differences results in a deferred tax asset in the year the temporary difference originates?
I.Accrual for product warranty liability.
II.Subscriptions received in advance
III.Prepaid insurance expense.

• A) I and II only.
• B) II only.
• C) III only.
• D) I and III only.

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Definitions:

Equilibrium Price

The price at which the quantity of a good or service demanded by consumers equals the quantity supplied by producers, resulting in a stable market condition where there is no tendency for change.

Total Revenue

A financial measure defining the income generated from business activities or operations without deducting expenses.

Price Rationing

The allocation of goods among consumers using prices, where the goods go to those willing to pay the highest price, often used when demand exceeds supply.

Able

Generally refers to having the capacity, skill, or qualifications to perform an action or task.