For Each of the Items Below,determine Whether the Items Are

question 19

Essay

For each of the items below,determine whether the items are temporary differences or permanent differences.
For each temporary difference,determine whether a deferred tax asset or deferred tax liability is created by the temporary difference described.Assume that each of the temporary differences described is an originating difference.
1.Accrued bad debt expense
2.The dividends received deduction
3.Installment sales revenue
4.Insurance payments for executives for which the company is the beneficiary
5.Fines paid for law violations
6.Municipal bond interest
7.Accrued warranty expense
8.Revenues received in advance
9.Expenses paid for in advance (prepaid insurance)
10.Tax depreciation expense exceeds GAAP (book)depreciation expense

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Definitions:

Polygraph Testing

A technique used in investigations and security screening that measures physiological responses to determine the truthfulness of answers provided by an individual.

Graphology Testing

An assessment technique that analyses a person's handwriting to make inferences about their personality or other attributes.

Cognitive Abilities

Mental skills that include reasoning, memory, attention, and language capabilities that enable an individual to learn and solve problems.

Knowledge

The information, understanding, and skills gained through experience or education; the theoretical or practical understanding of a subject.