Depreciation and amortization affect both net income reported in the financial statements and taxable income on tax returns. Which of the following is /are true?
a. Taxing authorities in most jurisdictions specify allowable depreciation methods for tax reporting.
b. When permitted to do so by the taxing authority, firms often use different depreciation methods for financial and tax reporting.
c. The difference between depreciation expense in the financial statements and the depreciation deduction on the tax return leads to an issue in accounting for income taxes.
d. all of the above
e. none of the above
D
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Which assertion addresses whether all transactions and accounts that should be included in the financial statements are included?
a. Existence. b. Valuation. c. Completeness. d. Rights and Obligations
Pelican Company issued $200,000 of 20-year, 6 percent bonds at 98 on one of its semiannual interest dates. The straight-line method of amortization is to be used. What is the total interest cost of the bonds?
A) $240,000 B) $244,000 C) $236,000 D) $235,000
Derivatives include
a. an option to purchase a share of stock. b. a commitment to purchase a certain amount of foreign currency in the future. c. interest rate, foreign exchange rate, and commodity price hedges. d. all of the above e. none of the above
Which sentence uses correct capitalization?
A) Either the company President or Vice President will address the staff on Monday. B) The Marketing Manager discussed ways to attract more customers to the website. C) Can you tell me, Professor, when our tests will be corrected?