The purpose of an inter-period income tax allocation is to    a. Allow reporting entities to fully utilize tax losses carried forward from a previous year.   b. Allow reporting entities whose tax liabilities vary significantly from year to year to smooth payments to taxing agencies.   c. Amortize the deferred tax liability shown on the balance sheet.   d. Recognize an asset or liability for the tax consequences of temporary differences that exist at the balance sheet date.

Q: tax allocation

A: Correct Answer 1 :- D The purpose is to relate the income tax expense to the items which affect the…

Q: Describe the types of temporary differences that cause deferred tax liabilities and determine the…

A: Deferred tax liabilities It is a type of liability that arises due to the difference between the tax…

Q: when congress changes the tax laws or rates, a corporation's deferred tax liability and asset…

A: A deferred tax liability is the tax due for a current period but not paid by a company. It is paid…

Q: The amount of income taxes due to the government for a period of time is rarely the amount reported…

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 tax accounting methods least likely defers payment of taxes?     Spread Out…

A: Spready Out method: Under this method revenue is recognised over a period of time. Lets make an…

Q: An example of intraperiod income tax allocation is a. Reporting an extraordinary item in the income…

A: Intra-period tax allocation: An intra-period tax allocation is an allocation of tax expense between…

Q: Interperiod and Intraperiod Tax Allocation  Income Tax allocation is an integral part of generally…

A: The term interperiod income tax allocation states to the income tax expense distribution among…

Q: Which of the following statements concerning IAS 12, Income Taxes, are correct? I. Accounting profit…

A: To solve the question, one should have knowledge of current tax, tax rates applicable for the…

Q: The information below pertains to Mondavi Corporation: (a.) For the current year temporary…

A: Journal Entry: Journal entry is the act of keeping records of transactions in an accounting journal.…

Q: Which statement is incorrect concerning tax assets and liabilities? * . When an entity makes…

A: Deferred tax assets and liabilities is discounted is the incorrect statement from all the above…

Q: Identify deferred tax assets/liabilities of this year and previous yearin this figure and explain on…

A: Tax is considered as the mandatory sum of money that is paid by the taxpayer to the state or local…

Q: A net operating loss occurs when tax-deductible expenses exceed taxable revenues. Tax laws permit…

A: Definition:   Net Operating Loss Carryforward: The net operating loss is considered a negative…

Q: All of the following are reported on the income statement net of tax except Select one: a. irregular…

A: Income statement: The income statement is one of the three primary financial statements used to…

Q: A deductible temporary difference leads to the payment of:   Select one: A. less tax in the…

A: The question is related to Taxes on Income.There are two types of deferred tax- (i) Deferred tax…

Q: Explain the Revenue Related to Deferred Tax Liabilities.

A: Deferred tax liability is explicitly made when an expense commitment gathered in one budgetary year…

Q: Intra-period tax allocation is the allocation of the total income tax expense to the various…

A: The answer for the True or false question and relevant explanation are presented hereunder : In Tax…

Q: In computing the change in deferred tax accounts, which tax rates are used? O A. Current tax rates…

A: SOLUTION- DEFERRED TAX LIABILITY AS BEING THE AMOUNT OF INCOME TAX PAYABLE IN FUTURE PERIODS IN…

Q: Identify the deferred tax assets/liabilities that is reported in the balance sheet articulating the…

A: As the definition suggests, the deferred tax liability occurs when taxable income is smaller than…

Q: Question Content Area Permanent differences impact deferred tax assets. current tax liabilities.…

A: There are two type of differences in accounting. One is permanent differences and other is temporary…

Q: g. An increase in the Deferred Tax Liability account on the statement of financial position is…

A: Solution Note Dear student as per the Q&A guideline we are required to answer the first question…

Q: Describe the types of temporary differences that cause deferred tax assets and determine the amounts…

A: Deferred tax liabilities It is a type of liability that arises due to the difference between the tax…

Q: Briefly explain the recognition criteria of deferred tax assets and deferred tax liability and the…

A: Both deferred tax liabilities and assets should be recognized gross in the balance sheet unless the…

Q: a In a period in which a taxable temporary difference reverses, the reversal will cause taxable…

A: Since, we answer only upto three sub-parts, we will answer first three. Please resubmit a new…

Q: If during the current year, taxable profit is greater than accounting profit and the difference is a…

A: Temporary differences refer to the differences between taxable and pre-tax book income the effect of…

Q: What are some of the reasons that the components ofincome tax expense should be disclosed and a…

A:

Q: Deferred tax asset is the * . amount of income tax paid or payable for a year as determined by…

A: Deferred Tax Assets is the deferred tax consequence attributable to a deductible temporary…

Q: Which of the following is deducted from the financial income in computing for the taxable income?…

A: Donations received during the year is deducted from the financial income in computing for the…

Q: Which statement is incorrect regarding other comprehensive income?

A: Other comprehensive income is the income which the company has not yet earned but yes will be earned…

Q: The following transactions were made by Company X during the current fiscal year. Explain whether or…

A: The Answer :

Q: An entity shall offset a deferred tax asset and deferred tax liability A. When income taxes are…

A: As per IAS 12 - Income Taxes, An entity shall offset a deferred tax asset and deferred tax liability…

Q: A temporary difference that would not result in a deferred tax asset but not a permanent difference?…

A: Solution: A temporary difference that would not result in a deferred tax asset but not a permanent…

Q: a) Explain the difference between pretax financial income and taxable income.

A: Hi! Thank you for the question, As per the honor code, we'll answer the first question since the…

Q: Which cost flow assumption must be used for financial reporting if it is also used for tax…

A: Financial reporting: Financial reporting is a typical accounting procedure in which financial…

Q: ustification for the method of determining periodic deferred tax expense is based on the concept of?…

A: Solution: According to matching principal, If income is recognized in particular period, all…

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

A: Temporary difference between the tax base and carrying amount arise on account of difference in the…

Q: Which of the following is not a disclosure related to income taxes based on IAS 12? * O The amount…

A: Answer: IAS 12- Income taxes. The disclosure related to income taxes is mentioned as : taxes…

Q: Which general principle applies to the reporting of income tax expenses under interim income…

A: Interim period income tax is accrues using the tax rate  that would be applicable to expected total…

Q: An income tax is an example of which of the following?a. Derived tax revenue.b. Imposed nonexchange…

A: Answer:   Option a.

Q: A temporary difference which would result in a deferred tax asset is A. Interest revenue on…

A: Introduction: Temporary differences are those differences arising between accounting and taxable…

Q: Expenditures currently deducted in the tax return but not included with expenses in the income…

A: Solution: Expenditures  currently deducted in the tax return but not included with expenses in…

Q: As a general rule, which of the following is to be included in the annual tax return as an income…

A: In annual tax return of any taxpayer, the income which is declared as taxable income is considered…

Q: (Terminology, Relationships, Computations, Entries)InstructionsComplete the following statements by…

A: a:   If the taxable difference reverses in a year then the reversal may increase the taxable income…

Q: Describe the procedure(s) involved in classifying deferred tax amounts on the statement of financial…

A: Deferred tax accounts nature must be analyzed and classified either as net current amount or as net…

Q: A deferred tax liability or asset that is related to an asset or liability shall be classified in…

A: Solution: True. This is because deferred tax liability or asset are classified in the statement of…

Q: Nonordinary items resulting in income or loss a. include unusual but not infrequent gains. b.…

A: a. include unusual but not infrequent gains.

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.