Which of the Following Statements Best Describes the Standard Used

question 113

Multiple Choice

Which of the following statements best describes the standard used by the courts to measure socially acceptable behaviour?

• A) an average person acting normally
• B) a careful person acting to the best of his ability
• C) a reasonably prudent person acting in a careful manner
• D) the best possible response to the circumstance
• E) When you cause injury, you are always liable.

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Definitions:

Deferred Tax Liabilities

Future tax payments a company owes but has not yet paid, often arising from timing differences between accounting practices and tax laws.

Deferred Tax Assets

Deferred tax assets are items on the balance sheet that reduce future tax obligations because of overpayment or advance payment of taxes or future tax benefits due to allowable temporary differences.

Book Income Tax Expense

The amount of income tax expense that is reported on the financial statements, which may differ from the actual tax paid due to differences between accounting and tax rules.

Temporary Difference

A difference between the carrying amount of an asset or liability in the balance sheet and its tax base, which will result in taxable or deductible amounts in the future.