Which of the Following Is an Example of a Temporary

question 117

Multiple Choice

Which of the following is an example of a temporary difference, which would result in a deferred tax asset?

• A)Investment losses recognized later for accounting purposes than for tax purposes
• B)Rent revenue collected in advance when included in taxable income before it is included in pre-tax accounting income
• C)Use of a shorter depreciation period for accounting purposes than is used for income tax purposes
• D)Use of straight-line depreciation for accounting purposes and an accelerated rate for income tax purposes

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Definitions:

Pyrimidine Base

A nitrogenous base that is one of the components of nucleic acids, including cytosine, thymine (in DNA), and uracil (in RNA).

Two Rings

Refers to the molecular structure characteristic of certain organic compounds, notably purines and certain types of aromatic hydrocarbons, consisting of two connected rings of atoms.

DNA Sequences

The order of nucleotides (adenine, thymine, cytosine, and guanine) in a segment of DNA, determining genetic information.

Twins

Two offspring born from the same pregnancy. Twins can be identical (monozygotic), meaning they develop from one zygote that splits and forms two embryos, or fraternal (dizygotic), meaning they develop from two different eggs fertilized by two different sperm.