When a Company Has a Credit Balance in Its Deferred

question 89

Multiple Choice

When a company has a credit balance in its Deferred Tax account, this amount would appear as an

• A) contra asset on the balance sheet.
• B) stockholders' equity account on the balance sheet.
• C) expense account on the income statement
• D) liability account on the balance sheet.

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Definitions:

Page Number

A number assigned to a specific page in a document or book to facilitate organization and reference.

Journalizing

Journalizing is the process of recording transactions in the company's journal, marking the first step in the accounting cycle by documenting all financial transactions.

Ledger

The principal book or computer file for recording and totaling economic transactions measured in terms of a monetary unit of account by account type.

Journalizing

The act of recording financial transactions in a company's journal, detailing debits and credits, part of the first step in the accounting cycle.