Which of the Following Is/are True About Holding Gains on Assets

question 164

Multiple Choice

Which of the following is/are true about holding gains on assets?

• A)U.S.GAAP recognizes the holding gain on the assets for the increase in values.
• B)IFRS permits recognition of the holding gains under certain circumstances.
• C)Under IFRS, if in a given period, an asset increases in value, the firm does not record depreciation and amortization during that period.
• D)Under U.S.GAAP, if in a given period, an asset increases in value, the firm does not record depreciation and amortization during that period.
• E)all of the above

---

Definitions:

Depreciation

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value due to use and wear and tear.

Income Tax Rate

The percentage at which an individual or corporation is taxed on their income.

Deferred Tax Asset

A financial statement item that represents an entity's right to reduce future tax payments due to temporary differences or certain carryover losses.

Deferred Tax Liability

A tax obligation recognized in the financial statements representing taxes that are owed but not yet paid.