Which of the Following Statements Regarding Book-Tax Differences Is True

question 113

Multiple Choice

Which of the following statements regarding book-tax differences is true?

• A) Corporations are not required to report book-tax differences on their income tax returns.
• B) Corporations will eventually recognize the same amount of income for book and tax purposes for income-related temporary book-tax differences.
• C) Income excludable for tax purposes usually creates a temporary book-tax difference.
• D)None of these is true.

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Definitions:

Inconvenience

The state of being caused trouble or difficulty, often resulting in disruption of plans or activities.

Routine Request

A standard or common request made in a professional setting, often for regular operations or procedures.

Explain

To make something clear or easy to understand by describing or giving information about it.

Justify

To provide valid reasons or evidence to support an argument or action.