Assume Both Current and Deferred Taxes Are Positive Values

question 49

Multiple Choice

Assume both current and deferred taxes are positive values.Given this,deferred taxes will

• A)reduce the current tax expense and thus increase net income.
• B)increase expenses and increase operating cash flows.
• C)increase expenses and lower operating cash flows.
• D)reduce net income but not affect the operating cash flows.
• E)reduce both net income and operating cash flows.

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Definitions:

Long Run

A period in economics where all inputs can be adjusted, allowing for full analysis of production, pricing, and employment levels.

Profit Or Loss

The financial result of a business's operations, calculated as the difference between revenue and expenses.

Maximizing Profits

The process of making the most financial gain possible from business operations, through various strategies such as cost reduction, revenue increase, or efficiency improvements.

Profit Maximizes

Refers to strategies or actions companies undertake to increase their profits to the highest possible level.