Able Ltd Has an Asset in Its Books with a Carrying

question 11

Multiple Choice

Able Ltd has an asset in its books with a carrying amount of $120 000 and a tax base of $90 000.The income tax rate has been 30% but in the current year it has been increased to 40%.Able Ltd should make the following entry in its books:

• A)
• \(\begin{array}{llr}
• \text { Dr Deferred Tax Liability} &\$ 3000 \\
• \text {Cr Deferredincome Tax Exnense } &&\$ 3000\\
• \end{array}\)
• B)
• \(\begin{array}{llr}
• \text { Dr Deferred Tax Asset } &\$ 3000\\
• \text { Cr Deferred Income Tax Liability} & &\$ 3000\\
• \end{array}\)
• C)
• \(\begin{array}{llr}
• \text { Dr Deferred Tax Asset } & \$ 3000\\
• \text {Cr Deferred Income Tax Expense } && \$ 3000\\
• \end{array}\)
• D)
• \(\begin{array}{llr}
• \text { Dr Deferred Income Tax Expense } &\$ 3000\\
• \text { Cr Deferred Tax Liability} &&\$ 3000\\\
• \end{array}\)

Recognize the importance of referrals in sales and how to generate them.

Understand the challenges associated with call reluctance and strategies to overcome it.

Realize the significance of customer service in maintaining and expanding the customer base.

Comprehend the concept of a prospect pool and the sources to create it.

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Definitions:

Job-Order Costing

An accounting method that collects and assigns manufacturing costs to individual units or batches of production, suitable for customized products.

Predetermined Overhead Rate

An estimate used to allocate manufacturing overhead to products, calculated before the accounting period begins based on expected costs and activity levels.

Gross Margin

The difference between revenue and cost of goods sold, divided by revenue, expressed as a percentage; it measures how efficiently a company uses its resources to make products.

Predetermined Overhead Rate

An estimated rate used to allocate manufacturing overhead costs to individual units of production, based on a selected activity base such as machine hours or labor hours.