Which of the Following Statements Is Correct Regarding Deferred Taxes

question 41

Multiple Choice

Which of the following statements is correct regarding deferred taxes under IFRS?

• A)Income tax payable plus or minus the change in deferred income taxes equals income tax expense.
• B)The current portion of income tax expense is the amount of change in deferred taxes related to the current period.
• C)In computing income tax expense, a company deducts an increase in a deferred tax liability to income tax payable.
• D)All of the choices are correct.

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Definitions:

Actual Sales Volume

The real number of units sold or services provided by a business during a specific period, as opposed to forecasted or planned sales volumes.

Budgeted Contribution Margin

The anticipated difference between sales revenue and variable costs in a budget period.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead incurred and the standard cost of variable overhead allotted for the actual production.

Indirect Materials

Materials used in the production process that are not directly part of the final product, such as lubricants for machines.