Which of the Following Types of Evidence Indicate That a Valuation

question 110

Multiple Choice

Which of the following types of evidence indicate that a valuation allowance is needed to reduce the deferred tax asset?

• A) history of profits
• B) excess of appreciated asset values over basis
• C) existing contracts or sales backlogs, which will generate significant future income
• D) short carryback or carryover periods

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Definitions:

Breach Of Contract

A situation in which one party fails to fulfill the terms of a contract, leading to legal consequences for the breaching party.

Legal Action

A formal process in which a legal proceeding is initiated to enforce a particular right, seek a remedy for a breach, or obtain a legal ruling.

Severe Inflation

A rapid and unchecked increase in prices within an economy, significantly eroding purchasing power.

Biscuit Packs

Typically refers to packages containing biscuits, prepared for retail sale.