Financial Statement Disclosure of the Components of Income Tax Expense

question 59

Multiple Choice

Financial statement disclosure of the components of income tax expense:

• A) Must be made on the face of the income statement.
• B) Usually is included in the disclosure notes.
• C) Is not necessary when only permanent differences exist.
• D) Must include the amount of cash paid for taxes.

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Definitions:

Distinctive Mark

A unique symbol or feature that distinguishes a product, service, or entity from others.

Manufacturer

An entity or individual that produces goods on a large scale using machinery, labor, and raw materials.

Equitable Remedy

A legal solution given by a court that requires a party to act or refrain from acting, rather than monetary compensation.

Reformation

An equitable remedy granted by a court to correct or "reform" a written contract so that it reflects the true intentions of the parties.