Which One of the Following Transactions Would Result in the Creation

question 4

Multiple Choice

Which one of the following transactions would result in the creation of a noncurrent deferred tax liability?

• A)interest received on municipal bonds
• B)a contingent liability expensed in the current period that is expected to require a cash payment in three years
• C)royalties received in advance that are taxable when received, but that will be earned within the next three months
• D)using an accelerated depreciation method for income tax purposes and the straight-line method for financial reporting purposes

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Definitions:

Plane Operating Costs

Expenses associated with operating an aircraft, which include fuel, maintenance, crew salaries, and landing fees among others.

Tenant-Days

A metric that represents the total number of days that all units in a property were occupied over a specific period.

Revenue Variance

The difference between actual revenue and budgeted or expected revenue.

Tenant-Days

A metric used in real estate or hospitality to measure the total number of days all units are rented out over a specific period.