On December 31, 2020, XYZ Inc

question 57

Multiple Choice

On December 31, 2020, XYZ Inc. has an account payable of $2,000 for operating expenses incurred during the year. These expenses are only tax deductible when paid. XYZ normally pays for its operating expenses one month after they are incurred. Assuming a 20% tax rate, these expenses shall result in:

• A) a deferred tax liability of $2,000.
• B) a deferred tax liability of $400.
• C) a deferred tax asset of $400.
• D) a deferred tax asset of $2,000.

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Definitions:

MSE

Mean Squared Error, a measure of the average squared differences between the estimated values and the actual value, indicating the quality of an estimator.

SSE

Sum of Squares due to Error, a measure used in statistical analysis to quantify the discrepancy between the observed and predicted data values.

Factorial Design

An experimental design method used in statistics that allows the investigation of the effects of multiple factors by varying them together.

Replication

The process of repeating a study or experiment to confirm the findings of the original study.