Which of the following statements is not true concerning the determination of the effective tax rate to be used for interim reporting?
A)Tax rate changes should not be accounted for retroactively.
B)The effective tax rate for the entire year should be estimated.
C)The effective tax rate should reflect anticipated tax credits.
D)The estimated tax rate should reflect extraordinary items.

Question

Which of the following statements is not true concerning the determination of the effective tax rate to be used for interim reporting?​
A)​Tax rate changes should not be accounted for retroactively.
B)​The effective tax rate for the entire year should be estimated.
C)​The effective tax rate should reflect anticipated tax credits.
D)​The estimated tax rate should reflect extraordinary items.

Quizplus · Accepted Answer

The estimated tax rate should reflect anticipated tax credits, but it should not reflect extraordinary items. Extraordinary items are reported separately and should not impact the calculation of the effective tax rate. A, B, and C are all true statements.

Which of the Following Statements Is Not True Concerning the Determination