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16 at origination which of the following temporary

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16. At origination which of the following temporary differences would create a deferred tax assetA.Tax basis of an asset exceeds its financial reporting basis.B.Tax basis of a liability exceeds its financial reporting basis.C.Financial reporting basis of an asset is equal to its tax basis.D.Financial reporting basis of an asset exceeds its tax basis.
17. Plaxo Corporation has a tax rate of 35% and uses the straight-line method of depreciation for its equipment,which has a useful life of four years. Tax legislation requires the company to depreciate its equipment using thefollowing schedule: year 1- 50%, year 2 - 30%, year 3 - 15% and year 4 - 5%. In 2006 Plaxo purchases a pieceof equipment with a four year life and an original cost of $100,000. What amount will Plaxo record as adeferred tax asset or liability in 2006?
18. The amount initially paid to acquire an asset is called ______________________________.
19. Firms recognize the reduction in service potential of assets such as building and equipment using theprocess of ____________________.
20. The amount that a company would have to pay today to acquire an asset it now holds is called________________________________________.current replacement costfull file at
Full file at Test-Bank-for-Financial-Reporting-Financial-Statement-Analysis-and-Valuation-A-Strategic-Perspective-7th-Edition-by-Wahlen21. The difference between income tax payable and income tax expense is reported on the balance sheet aseither ___________________________________ or a ___________________________________.deferred tax asset, deferred tax liability22. Items, such as interest revenue on municipal bond holdings, that do not affect taxable income or incometaxes paid in any year are referred to as _____________________________________________.permanent differences23. Revenues and expenses that firms include in both net income to shareholders and in taxable income, but indifferent periods are referred to as _____________________________________________.temporary differences24. Stockholders’ equity can be expanded into the following three accounts: contributed capital, retainedearnings and _________________________________________________________________.accumulated other comprehensive income25.Balance Sheet EquationCash+Non-CashAssets=Liabilities+ContributedCapital+Accumulated OtherComprehensiveIncome+RetainedEarningsRefer toBalance Sheet Equation. If ORP Corporation sells $25,000 of its product on account, it will see an increase in non-cash assets and___________________________________.retained earnings26.Balance Sheet EquationCash+Non-CashAssets=Liabilities+ContributedCapital+Accumulated OtherComprehensiveIncome+RetainedEarningsfull file at
Full file at Test-Bank-for-Financial-Reporting-Financial-Statement-Analysis-and-Valuation-A-Strategic-Perspective-7th-Edition-by-WahlenRefer toBalance Sheet Equation. To recognize the cost of goods sold ORP Corporation will reduce retained earnings and reduce______________________________.

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Term
Spring
Professor
AMMONS

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