Which of the Following Best Describes the Focus of ASC

question 3

Multiple Choice

Which of the following best describes the focus of ASC 740?

• A) ASC 740 takes an "asset and liability approach" that focuses on the balance sheet
• B) ASC 740 takes an "income and expense approach" that focuses on the income statement
• C) ASC 740 takes a "taxes paid or refunded approach" that focuses on the statement of cash flows
• D) ASC 740 takes a "permanent differences approach" that focuses on the effective tax rate reported in the income tax note to the financial statements

---

Definitions:

Event A

A specified occurrence or result in a probabilistic framework that is subject to study or analysis.

Event B

A term used in probability theory to denote a specific outcome or set of outcomes from a stochastic experiment.

0 ≤ P ≤ 1

A mathematical expression indicating that the value of P (probability) ranges from 0 to 1, inclusive.

Outcome

An outcome is the result or consequence of an action, experiment, or event, often used in the context of probabilities and statistical experiments.