Which of the Following Items Is Not Included in the GAAP

question 62

Multiple Choice

Which of the following items is not included in the GAAP financial statement income tax footnote's effective tax rate reconciliation?

• A) Hypothetical tax on book income at U.S. Federal corporate tax rate.
• B) Total tax expense per the GAAP financial statements.
• C) Tax effect of temporary differences.
• D) Tax effect of permanent differences.

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Definitions:

Term Structure

The relationship between interest rates or bond yields and different terms or maturities.

Duration

Duration is a measure of the sensitivity of the price of a bond or other debt instrument to changes in interest rates, typically expressed in years.

Interest Rate Risk

The potential for investment values to change due to variations in the prevailing interest rates.

Coupon Rate

The annual interest rate paid by a bond's issuer to its bondholders, typically expressed as a percentage of the bond's face value.