Quiz 16.100 – Disclosing Components of Income Tax Expense on Financial Statements
Intermediate Accounting
Spiceland, Nelson, and Thomas
10th Edition
How should the components of income tax expense be disclosed on financial statements?
How should the components of income tax expense be disclosed on financial statements?
Given that Lucas Corp. has $2 million in temporary differences that will increase taxable income next year due to differences between depreciation reported in the income statement and depreciation deducted for tax purposes and no other temporary differences, how should deferred income taxes be reported in the ending balance sheet?
Given that Webnet Inc. has $6 million of tax depreciation in excess of depreciation in its income statement on its tax return, and $1 million of the $6 million difference will reverse itself next year, while the remainder will reverse over the next 4 years with no other temporary differences, how should deferred income taxes be reported in the balance sheet at the end of the current year?
Valuation allowances have an impact on the calculation of deferred tax liabilities. True or False?
Match each phrase with its corresponding terminology, valuation allowance, operating loss, etc…
Match each phrase with its corresponding terminology, operating loss carryforward, deferred tax asset, etc…
Match each situation if it is a deferred tax asset, a deferred tax liability, or neither.
Match each phrase with its corresponding terminology, balance sheet, permanent difference, etc…
Enacted tax rate changes that are not effective in the current period do not impact deferred tax accounts until the new rates take effect.
Enacted tax rate changes affect income tax expense only in the years when tax payable is affected.