The Largest Item of the Deferred Tax Liability for Most

question 54

Multiple Choice

The largest item of the Deferred Tax Liability for most companies is caused by:

• A)providing the allowance for doubtful accounts for book purposes.
• B)differences in inventory cost flow assumptions (FIFO vs.LIFO)for tax versus financial accounting purposes.
• C)differences in depreciation methods (accelerated vs.straight-line)for tax versus financial accounting purposes.
• D)amortizing bond premium or discount for tax purposes.

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Definitions:

Buy One, Get One Free

A promotional sales tactic where customers receive an additional item at no extra cost upon purchasing one.

Sales Promotion

A marketing strategy involving the short-term use of incentives or discounts to encourage the purchase of a product or service.

Rebate

A consumer discount in which a portion of the purchase price is returned to the buyer in cash; the manufacturer, not the retailer, issues the refund.

Samples

Small portions or quantities of a product distributed free or at a minimal cost to serve as a representation of the whole, allowing potential customers to test before making a purchase.