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What Is the Deferred Tax Liability Under the Deferral Method

question 95

Multiple Choice

What is the deferred tax liability under the deferral method for FY2018?
What is the deferred tax liability under the deferral method for FY2018?   A) $52,500 B) $36,750 C) $27,500 D) $15,750


Definitions:

Straight-line

A method of calculating depreciation of an asset where the expense is evenly distributed over its useful life.

Effective-interest

A method of calculating the interest rate on a loan or financial product that takes into account compound interest and fees, providing a true annual rate.

Amortization

The method of distributing the expense of a non-physical asset across its lifespan.

Market Rate

The prevailing rate of interest available in the marketplace for securities or loans.

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