Which of the Following Is the Most Likely Item to Result

question 58

Multiple Choice

Which of the following is the most likely item to result in a deferred tax asset?

• A) Using accelerated depreciation for tax purposes but straight-line depreciation for accounting purposes
• B) Using the completed-contract method of recognizing construction revenue tax purposes,but using percentage-of-completion method for financial reporting purposes
• C) Prepaid expenses
• D) Unearned revenues

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Definitions:

Assignment

The process of transferring rights or obligations from one party to another in a contract.

Delegation

The process of assigning responsibility and authority to someone to carry out specific activities, while the person delegating retains ultimate responsibility for its success.

Lawsuit

A legal action taken by one party against another in a court of law, usually seeking compensation for damages or enforcement of a right.

Duty

A moral or legal obligation; a responsibility.