The Statement of Cash Flows Reports

question 157

Multiple Choice

The statement of cash flows reports:

• A)Assets,liabilities,and equity.
• B)Revenues,gains,expenses,and losses.
• C)Cash inflows and outflows for an accounting period.
• D)Equity,net income,and dividends.
• E)Changes in equity.

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Definitions:

Deferred Tax Liabilities

Future tax payments a company is obligated to pay the government, arising due to temporary differences between its taxable income and its accounting earnings.

Deferred Tax Assets

Future tax benefits obtained due to deductible temporary differences and carryforwards, recognized in financial accounting.

Book Income Tax Expense

The income tax expense reported in the financial statements, calculated based on the accounting income before taxes.

Temporary Difference

Differences between the carrying amount of an asset or liability in the balance sheet and its tax base that will result in taxable or deductible amounts in the future.