Which of the Following Book-Tax Basis Differences Results in a Deductible

question 116

Multiple Choice

Which of the following book-tax basis differences results in a deductible temporary difference?

• A)Book basis of an employee's postretirement benefits liability exceeds its tax basis.
• B)Book basis of a building exceeds the tax basis of the building.
• C)Book basis of an acquired intangible exceeds the tax basis of the intangible.
• D)Tax basis of a prepaid liability exceeds the book basis of the liability.

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Definitions:

Negative Slope

A line or curve on a graph that descends from left to right, indicating an inverse relationship between two variables.

Vertical Line

In geometry, a straight line that runs up and down the page, perpendicular to the horizon.

Slope

is a measure of the steepness or inclination of a line, calculated as the ratio of the vertical change to the horizontal change between two points on the line.

Positive

Expressing or implying affirmation, agreement, or permission; in economics, may refer to aspects such as positive externalities or positive growth rates.