Which of the Following Statements Concerning the Classification of Deferred

question 67

Multiple Choice

Which of the following statements concerning the classification of deferred tax assets and liabilities is true?

• A) A deferred tax asset is classified as noncurrent if the company expects the future tax benefit to be received more than 12 months from the balance sheet date.
• B) A deferred tax asset related to inventory capitalization is classified as noncurrent if the company uses a FIFO accounting method and the inventory to which the deferred tax asset relates will not be treated as sold within 12 months from the balance sheet date.
• C) A deferred tax asset related to a bad debt reserve is classified as current if the related accounts receivable is classified as a current asset.
• D) All deferred tax assets and liabilities are treated as noncurrent beginning in 2016.

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Definitions:

Psychotherapeutics

The treatment of mental or emotional disorders through psychological methods rather than medical interventions.

Perception

The process by which individuals select, organize, and interpret sensory input to form a meaningful picture of the world.

Sense of Smell

The ability to detect odors through a specialized organ, typically the nose, which is a significant part of human and animal sensory systems.

Psychophysics

A branch of psychology that deals with the relationships between physical stimuli and the perceptions and sensations they produce in the observer.