Deferred Taxes

Question 1

Equal to the taxes actually owed for the current period +/- the change during the current period in amounts payable in the future and in future tax benefits

Answer 1

Financial income tax expense

Question 2

The difference between the tax basis of an asset or liability and its reported amount in the financial statements that will result in taxable or deductible amounts in future years when the reported amount of hte asset/liability is recovered or settled

Answer 2

Temporary difference

Question 3

the difference that occurs when a revenue or expense item is only included in pretax financial (book) income or in taxable income, but will never be included in both (ex. tax exempt trnasactions/securities)

Answer 3

Permanent differences

Question 4

The deferred tax consequences attributable to deductible temporary differences and carryforwards–must be reduced by a valuation accountif a portion or all of the deferred tax asset will not be realized in the future

Answer 4

Deferred tax asset

Question 5

An amount htat is recognized for deferred tax cnsequence of temporary differences that will result in taxable amounts in future years

Answer 5

Deferred tax liability

Question 6

The amount of income taxes paid or payable for ayear as determined by applying hte provisions of hte tax law to the taxablwe income or excess of deductions over revenues for that year

Answer 6

Current tax expense or benefit

Question 7

The change duringthe year in an an enterprise’s deferred tax liabilities or assets

Answer 7

Deferred tax expense or benefit

Question 8

Method of accounting for deferred taxes in which future taxable or deductible amounts must bemeasuredusingenactedtax rates expected to be in effect in the periods such amounts will impact taxable income

Answer 8

Liability method

Question 9

Occur when losses in the current period are carried back to periods in which there was income–results in tax refunds in the loss period and thus should be recognized in the year of the loss

Answer 9

Loss carryback–operating losses can be carried back 2 years, or forward 20

Question 10

Occurs when losses in he current period are carried forward to future periods (20)–always recognizedi n the year hte loss occurs and always recognized as a deferred tax asset

Answer 10

Loss carryforward