If a Company's Deferred Tax Asset Is Not Reduced by a Valuation

question 174

Multiple Choice

If a company's deferred tax asset is not reduced by a valuation allowance, the company believes it is more likely than not that:

• A) Sufficient accounting income will be generated in future years to realize the full tax benefit.
• B) Sufficient accounting and taxable income will exist in future years to realize the full tax benefit.
• C) Sufficient taxable income will be generated in future years to realize the full tax benefit.
• D) Tax rates will not change in future years.

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