A Result of Inter-Period Tax Allocation Is That

question 85

Multiple Choice

A result of inter-period tax allocation is that:

• A) Large fluctuations in a company's tax liability are eliminated.
• B) The income tax expense is allocated among the income statement items that caused the expense.
• C) The income tax expense in the income statement is the sum of the income taxes payable for the year and the changes in deferred tax asset or liability balances for the year.
• D) The income tax expense shown in the income statement is equal to the deferred taxes for the year.

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Definitions:

Minimum-Contacts Test

A legal standard used to determine whether a court has jurisdiction over an out-of-state defendant based on the defendant's activities within the state.

Jurisdiction

The legal authority of a court to hear and decide a case.

Federal Question

A legal issue directly involving the interpretation of the U.S. Constitution, federal laws, or treaties.

Original Jurisdiction

The authority of a court to hear a case for the first time, as opposed to appellate jurisdiction, which hears appeals on previously adjudicated decisions.