The temporary difference associated with accelerated depreciation for tax purposes and straight-line depreciation for financial reporting purposes means that a firm will pay lower income taxes in the early years of the asset's life, but this temporary difference will reverse over the entire asset life, resulting in higher taxes in later years.

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This statement accurately describes the effects of the temporary difference associated with accelerated depreciation for tax purposes and straight-line depreciation for financial reporting purposes. Initially, the accelerated depreciation lowers taxable income and reduces the firm's tax liability. However, when the straight-line depreciation catches up with the accelerated depreciation, taxable income increases, and the firm's tax liability also increases. This is because the temporary difference between tax and book values of the asset eventually evens out over the asset's useful life.

The Temporary Difference Associated with Accelerated Depreciation for Tax Purposes