Intraperiod Taxes Flashcards Preview

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Flashcards in Intraperiod Taxes Deck (10):
1

Under the current generally accepted accounting principles, which approach is used to determine income tax expense?

Asset and Liability Approach

Also known as the "Balance Sheet Approach"

2

Define "deferred income tax".

The amount of income tax expense that is not currently due.

3

Define "pretax accounting income".

Income before income tax for financial accounting purposes determined by applying GAAP.

4

Define "interperiod tax allocation".

The process of measuring and recognizing the total income tax consequences of transactions in the year.

5

Define "income tax liability".

The amount of income tax the firm must pay on taxable income for a year.

6

Define "income tax expense".

  • The account reported in the income statement that measures the income tax cost for the year's transactions.
  • It is the net sum of the income tax liability, net change in the deferred tax accounts.

7

Define "deferred income tax provision".

  1. The amount of income tax expense that is not currently due;
  2. Equals the net sum of the change in the deferred tax accounts.

8

Define "current income tax provision".

The amount of income taxes due for the year (same as income tax liability).

9

Define "taxable income".

Income before tax for tax purposes.

10

What is the calculation for 

Total Tax Effects for a period?

Income Tax Expense or Benefit

+ Deferred Income Tax Expense of Benefit 

Current Tax Liability