Which of the Following Is an Example of a Temporary

question 51

Multiple Choice

Which of the following is an example of a temporary difference which would not result in a deferred tax asset?

• A) Allowance method for doubtful accounts is used for accounting purposes while direct write-off is required for tax purposes.
• B) Use of sales method of revenue recognition for accounting purposes, and instalment method of revenue recognition for tax purposes.
• C) Unrealized loss on short term investment is recognized for accounting purposes during the holding period while the actual loss on date of disposal is used for tax purposes.
• D) Estimated loss on disposal of a segment of a business recognized for accounting purposes but reported on the income tax return later on the basis of the actual loss.