On Its Tax Return at the End of the Current

question 65

Multiple Choice

On its tax return at the end of the current year Webnet Inc. has $6 million of tax depreciation in excess of depreciation in its income statement. A footnote reveals that $1 million of the $6 million difference will reverse itself next year, and the remainder will reverse over the next 4 years. In the absence of other temporary differences, in the balance sheet at the end of the current year Webnet would report:

• A)Both a current deferred tax asset and a noncurrent deferred tax asset.
• B)A noncurrent deferred tax asset.
• C)Both a current deferred tax liability and a noncurrent deferred tax liability.
• D)A noncurrent deferred tax liability.

---

Definitions:

Simultaneous-Move

Refers to games or decision scenarios where all players make their moves at the same time, without knowledge of the others' choices.

Loss

Loss refers to the situation in which the total costs exceed the total revenues of a business or transaction, resulting in a negative profit.

Simultaneous-Move

A strategy in game theory where all players make their moves at the same time, unaware of the choices other players are making.

Mixed Strategy

In game theory, a strategy where a player can choose between multiple options with certain probabilities.