How might a reduction in future tax rates affect deferred tax assets in a way that reduces current net income?

Q: Describe the Changes in Enacted Tax Laws or Rates.

A: The enacted tax rates are used. to calculate income tax amounts. Enacted or substantively enacted…

Q: What effect do permanent differences have on deferred income taxes?

A:

Q: Deferred tax assets and deferred tax liabilities represent the tax effect of the temporary…

A: Temporary differences are those differences which are there in between carrying value of asset or…

Q: List examples of temporary differences that create: deferred tax assets. Deferred tax liability.

A: A deferred tax asset is a balance sheet item that results from an excess or early tax payment. A…

Q: Which of the following is a correct formula to compute for total income tax expense?      a. Current…

A: >There are various timing differences between pretax income and taxable income. >These timing…

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

A: Unearned revenue is the most likely item to result in a deferred tax asset.  Unearned revenue means…

Q: Difference between tax deduction and tax credit. Give example of each. Some tax credits are referred…

A: Tax: Governments levy taxes on residents to create revenue for projects that would strengthen the…

Q: Will the existence of unused tax losses always lead to the recognition of a deferred tax assets?…

A: Deferred tax assets arising from the deductible temporary difference because of different treatment…

Q: What is meant by “tax allocation within a period”? What is the justification for such practice?

A: Tax: Tax refers to a compulsory payment or a contribution to the state revenue, levied by the…

Q: What is the logic behind allowing tax loss carrybacks/carryforwards?

A: Logic behind allowing tax loss carrybacks and carryforwards: A tax loss carryback permits a company…

Q: What is an unrecognized tax benefit and how does it affect a company's current income tax expense?

A: The Meaning of Income Tax: FASB defines income tax as a tax on earnings. It is measured in terms of…

Q: If the increase in deferred tax asset is ____ than the increase in deferred tax liability, there is…

A: If the increase in deferred tax asset is Higher than the increase in deferred tax liability, there…

Q: What is deferred tax?

A: Balance sheet is the statement that indicates the final position of an entity.

Q: current and future tax consequences of transactions accounted for

A: (Note: Since you have posted multiple questions, we will solve the first question for you. For the…

Q: Which of the following decreases the benefit of accelerating tax deductions? Decreasing tax rates…

A: The following thing which decrease the benefit of accelerating tax deductions According to the…

Q: Define tax loss carryback and carryforward

A: Tax or Taxes: Tax is an amount paid by the persons (individuals and business entities) to a…

Q: What are FUTA and SUTA taxes? Is there any possible reduction in the FUTA tax rate? If so, what is…

A: Introduction: Employer payroll taxes are paid by the employer from its own funds on the basis of…

Q: What problems might create from payroll tax deferral?

A: Highlights of the payroll tax deferral scheme:- It applies to all those employees whose before tax…

Q: What are the advantages of claiming the standard deduction versus itemizing deductions on your…

A: Income tax:   It is the tax every individual or company is liable to pay on the income generated…

Q: What is a temporary difference related to deferred taxes?

A: Deferred Taxes:   The timing difference of tax effect called Deferred tax. Its recognized on all…

Q: Which of the following is NOT a reason why timing is significant in tax? Group of answer choices…

A: Tax: When any assesse is earned the income from any sources of income which are mentioned in the tax…

Q: Deferred tax liabilities should be treated as equity when:A . they are not expected to reverse.B .…

A: Deferred tax liability: Deferred tax liability is a tax that is measured or is outstanding for the…

Q: A deferred tax liability (or asset) is described as the tax effect of the temporary difference…

A: A deferred tax adjustment is prevalent where there is a temporary difference in the book value and…

Q: Explain deferred tax assets.

A: Temporary Difference: Temporary difference refers to the difference of one income recognized by the…

Q: Can the effective rate of tax be negative? Why? or Why

A: it is sometimes possible that effective tax may be negative.This is but rare cases but sometimes it…

Q: What is an uncertain tax position, and what are the ­general guidelines for accounting for uncertain…

A:

Q: Is fringe tax considered a penalty tax?

A: A fringe benefit is a final tax on an employee's salary that the company is required to withhold.…

Q: What is a permanent difference? Give an example What is a temporary difference? Give an example. How…

A: 1) Difference between the tax expense and tax payable which is caused by an item which does not…

Q: Explain why permanent differences have no deferred tax consequences.

A: A permanent difference is a business transaction that is reported differently for financial and tax…

Q: deferred tax liability uses    a. Expected future tax law, regardless of whether those expected laws…

A: Solution: Deferred tax liability is based on future taxable amounts which will be taxed in near…

Q: Briefly explain what factors significantly affect tax avoidance

A: Tax avoidance is a mechanism through which a taxpayer takes advantages of the loopholes in the tax…

Q: consequence of underestimating provisional tax

A: Provisional tax is the amount of tax to be paid by taxpayers earning income other than salary in…

Q: What is a deferred tax liability?

A: Deferred tax liability arises due to the difference in the amount of accounting income and taxable…

Q: What is the effect of deferred tax asset and deferred tax liability on the current year’s income tax…

A: Deferred tax assets and deferred tax liability arises because of the timing differences of the…

Q: In general, accrual basis taxpayers cannot take deductions for tax purposes until economic…

A: Accrual basis of accounting requires an individual or other entity to record the revenues and…

Q: Define Deferred Tax Liabilities.

A: Definition:   Income tax expense: The expenses which are related to the taxable income of the…

Q: An excess tax depreciation will result to a deferred tax liability.

A: In many countries, companies maintain two sets of books of accounts for financial and tax purposes.…

Q: Why deferred tax rate assets and liabilities are recorded in balance sheet?

A: The reasons for the recognition and reporting of deferred tax assets are as follows: The following…

Q: Will the existence of unused tax losses always lead to the recognition of a deferred tax assets?…

A: SOLUTION- DEFERRED TAX = IT REFERS TO EITHER A POSITIVE (ASSETS) OR NEGATIVE (LIABILITY) ENTRY ON…

Q: Valuation allowances reduce deferred tax liabilities to the amount that is more likely than not to…

A: Solution:- A valuation allowance is used for the purpose of offsetting deferred tax asset. The…

Q: Deferred tax asset and deferred tax liability are based on future tax rates while current tax asset…

A: The concept of Deferred Tax arises due to the timing difference between income as per the accounting…

Q: between refundable tax credits and non-refundable tax credits and which is more valuable

A: The amount of money that is allowed to be reduced from overall tax liability of taxpayer is known as…