How Are IASB Requirements to Account for Joint Ventures Different

question 12

Multiple Choice

How are IASB requirements to account for joint ventures different from U.S.GAAP?

• A)International standards require the equity method,but U.S.GAAP allows for flexibility in accounting for joint ventures.
• B)U)S.GAAP requires the equity method,whereas the international standards allow for proportionate consolidation.
• C)IASB standards and U.S.GAAP are essentially the same for accounting for joint ventures.
• D)IASB standards do not specify which methods are allowed to account for joint ventures,whereas U.S.GAAP requires proportional consolidation.

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Definitions:

IFRS Deferred Tax Assets

Assets recognized in financial statements under International Financial Reporting Standards (IFRS) due to temporary differences that will result in deductible amounts in the future.

Interperiod Tax Allocation

The process of distributing income tax expenses or benefits over different accounting periods because of temporary differences that cause deferred tax amounts.

Intraperiod Tax Allocation

The allocation of income tax expense or benefit among various components of comprehensive income, net income, and other directly related statements within a single period.

Current Taxes Payable

This refers to the amount of taxes a company is obligated to pay to the government within the current fiscal year, not yet paid.