When congress makes a tax law or rate change, a corporation recognizes financial statement impact by adjusting the deferred assets or liabilities as of the beginning of the year in which the change is made.

Question

Quizplus · Accepted Answer

This is true. When a tax law or rate change is made, a corporation recognizes the financial statement impact by adjusting their deferred assets or liabilities retroactively, as of the beginning of the year in which the change is made. This is done to reflect the new tax rate or law in their financial statements accurately.

When Congress Makes a Tax Law or Rate Change, a Corporation