The FASB came to which of the following conclusions regarding interperiod income tax allocation?
Recognize the conclusions provided by FASB regarding inter-period income tax allocation.
Financial accounting standards board (FASB): This is the organization which creates, develops, and approves accounting standards; and administrates GAAP.
Inter-period tax allocation: Inter-period tax allocation is a process of distributing the company’s income tax payable as an expense to various accounting periods. This method is used to calculate the deferred tax assets and liabilities for the temporary difference.
Explanation for the options:
a. Since, FASB concludes that the asset/liability method of income tax allocation should be used or financial accounting and reporting for income taxes. Thus, this option is incorrect...
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