Which of the Following Is an Example of a Temporary

question 34

Multiple Choice

Which of the following is an example of a temporary difference that could result in a deferred tax asset?

• A) Gain on disposal of an asset when included in taxable income before it is included in pretax accounting income
• B) Use of straight-line depreciation for accounting purposes and an accelerated rate for income tax purposes
• C) Gross margin on installment sales is recognized for accounting purposes before it is included in taxable income in the income tax return
• D) Prepayments of expenses in year of payment;recognition of expense for accounting purposes occurs in a later year

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Definitions:

Setbacks

Events or conditions that hinder progress or cause a decline in performance, often temporarily.

Personal Flaws

Individual weaknesses or shortcomings that are often character-based and can impact one's decisions or actions negatively.

Bipolar Disorders

Bipolar disorders are a group of mental health conditions signified by extreme mood swings that include emotional highs (mania or hypomania) and lows (depression).

Population

The total number of individuals or entities within a specified area or belonging to a particular group.