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Which statement is accurate?
A) The taxes payable method is also known as the "deferral method."
B) The deferral method and the accrual method are "tax allocation" approaches.
C) The income statement approach is also known as the "accrual method."
D) The balance sheet approach is also known as the "deferral method."
4) How much tax would be reported under the taxes payable method for F2014?
|
|
F2013 |
F2014 |
F2015 |
|
Income before tax |
120,000 |
110,000 |
120,000 |
|
Taxable income |
85,000 |
95,000 |
105,000 |
|
Tax rate |
30% |
25% |
30% |
A) 23,750
B) 25,500
C) 27,500
D) 36,000
5) Which accurately describes the purpose of the taxes payable method?
A) It represents the amount of income recognized for accounting purposes.
B) It represents the amount of income recognized for tax purposes.
C) It calculates tax expense based on the accounting income before tax.
D) It calculates tax expense based on the amount payable to tax authorities.
6) What is one reason to use the taxes payable method?
A) It is a complicated method, but results in the least tax expense.
B) A company only pays tax once a year under this method.
C) It results in the best matching for the balance sheet.
D) It is the least costly method for tax accounting.
7) How much tax would be reported under the taxes payable method for F2015?
|
|
F2013 |
F2014 |
F2015 |
|
Income before tax |
120,000 |
110,000 |
120,000 |
|
Taxable income |
85,000 |
95,000 |
105,000 |
|
Tax rate |
30% |
25% |
30% |
A) 25,500
B) 31,500
C) 33,750
D) 36,000
8) Which statement is accurate?
A) Accounting income is generally higher than taxable income.
B) Accounting income is determined by financial reporting.
C) The balance sheet is unaffected by the tax accounting method.
D) The taxes payable method is a "tax allocation" approach.
9) Which statement best describes the "deferral method"?
A) This method focuses on the balance sheet.
B) This method is an example of a "tax allocation" approach.
C) This is the same as the "accrual method" of tax accounting.
D) This method is used by companies reporting using IFRS.
10) Which method does not use "temporary differences" to account for income tax expense?
A) The taxes payable method.
B) The deferral method.
C) The accrual method.
D) The tax allocation method.
Dec 12 2019 View more View Less
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