Vol. 3 LM2 Non-Current Assets: Deferred Tax Assets

Question 1

Fill in the blank

___ may result when the actual income tax payable based on income for tax purposes in a period exceeds the amount of income tax expense based on the reported financial statement income due to temporary timing.

Balance Sheet

Answer 1

Deferred tax assets

Balance Sheet

Question 2

recognition principle

deferred tax assets

Balance Sheet

Answer 2

recognized if there is an expectation that there will be taxable income in the future, against which the temporary difference or carried forward tax losses or credits can be applied.

Balance Sheet

Question 3

Fill in the blank

Deferred tax asset occurs when:
the tax basis is ____ than the book carrying value of a financial statement asset

Balance Sheet

Answer 3

greater

Balance Sheet

Question 4

Fill in the blank

Deferred tax asset occurs when:
the tax basis is ____ than the book carrying value of a financial statement liability

Balance Sheet

Answer 4

less or lower

Balance Sheet