E19-6 - E19-6(LO 6(Identify Temporary or Permanent...

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E19-6 (LO 6 ) (Identify Temporary or Permanent Differences) Listed below are items that are commonly accounted for differently for financial reporting purposes than they are for tax purposes. Instructions For each item below, indicate whether it involves: 1. A temporary difference that will result in future deductible amounts and, therefore, will usually give rise to a deferred income tax asset. 2. A temporary difference that will result in future taxable amounts and, therefore, will usually give rise to a deferred income tax liability. 3. A permanent difference. Use the appropriate number to indicate your answer for each. 1. __ 2 ___ The MACRS depreciation system is used for tax purposes, and the straight-line depreciation method is used for financial reporting purposes for some plant assets. 2. __ 1 ___A landlord collects some rents in advance. Rents received are taxable in the period when they are received. 3.
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