Recognizing a Valuation Allowance for a Deferred Tax Asset Requires

question 101

Multiple Choice

Recognizing a valuation allowance for a deferred tax asset requires that a company

• A) consider all positive and negative information in determining the need for a valuation allowance.
• B) consider only the positive information in determining the need for a valuation allowance.
• C) take an aggressive approach in its tax planning.
• D) pass a recognition threshold, after assuming that it will be audited by taxing authorities.