JMR Corporation Suffered a Loss in 2013

question 90

Multiple Choice

JMR Corporation suffered a loss in 2013.As a result, the Corporation has an $87,000 accumulated tax loss carry forward.The current tax rate is 40%.The benefit was recorded in the accounts, as JMR believed it was more likely than not to be realized.In 2014 the tax rate goes down to 38% and JMR has not yet used the benefit.Which of the following statements is true?

• A)Deferred income tax asset-benefit will not change
• B)Income tax expense should be increased by $1,740
• C)Deferred income tax asset-benefit should be increased by $1,740
• D)No change to the accounts is necessary

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Definitions:

Prospective Country

A term potentially referring to a country viewed with regard to its future potential for development, investment, or growth.

Beaten Paths

Established methods or routines that have been widely used or explored, often implying a lack of innovation.

Home Country

Refers to the country where a company is headquartered or originates from.

Migration Behavior

The patterns or tendencies of individuals or groups to move from one location to another, often in search of better living conditions.