Using Different Depreciation Methods for Book Purposes Versus Tax Purposes

question 163

Multiple Choice

Using different depreciation methods for book purposes versus tax purposes for the same asset is

• A)not allowed since the amount can only be calculated one way or the other,not both.
• B)the direct result of the differing goals of financial and tax accounting.
• C)contrary to GAAP.
• D)against the Internal Revenue Code,and as such,against the law.

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Definitions:

Injunction

A legal order issued by a court that directs an individual or organization to do or refrain from doing a specific act, used to prevent harm or secure relief.

Confidential Information

Sensitive data that is not public knowledge and is protected from unauthorized disclosure under legal, contractual, or professional duties.

Specific Performance

A legal remedy in contract law which mandates the exact performance of an agreement, rather than a monetary award for breach.

Rescission

The act of revoking, cancelling, or annulling a contract, returning all parties to their pre-contractual states.