Which of the Following Statements Best Describes a Valuation Allowance

question 53

Multiple Choice

Which of the following statements best describes a valuation allowance as it relates to accounting for income taxes?

• A)A valuation allowance is a contra account to deferred tax assets only.
• B)A valuation allowance is a contra account to deferred tax liabilities only.
• C)A valuation allowance is a contra account to deferred tax assets and liabilities.
• D)A valuation allowance is a contra account to noncurrent deferred tax assets only.

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Definitions:

Narcotic Drug

Substances that can change a person's consciousness or mood and are often used for pain relief but can lead to addiction.

Behaviorism

A theory of learning which states that all behaviors are acquired through conditioning processes and interactions with the environment, without the need for internal thoughts or feelings.

Mental Processes

Internal cognitive operations that include thinking, perceiving, planning, and understanding, which underlie an individual's reactions to various situations and stimuli.

Behavior

The actions or reactions of an object or organism, often in response to the environment.