Deferred Income Taxes Is a Balance Sheet Item for Iowa

question 80

Multiple Choice

Deferred income taxes is a balance sheet item for Iowa Products Company.How would it most likely be classified on the balance sheet?

• A) Owners' equity
• B) Long-term liability
• C) Expense
• D) Contra liability

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Definitions:

Manufacturing Overhead

Indirect costs associated with manufacturing, such as utilities, maintenance, and factory equipment depreciation, not directly tied to specific units of product.

Fixed Portion

The segment of total costs that does not change with changes in the activity level.

Cost Behavior

Describes how various production expenses vary with adjustments in production output.

Fixed Costs

Expenses that do not vary with production volume, such as rent, salaries, and insurance.