U.S.GAAP and IFRS require that some temporary differences create deferred tax assets.The temporary differences include the

Question

Quizplus · Accepted Answer

Both provisions for estimated uncollectible accounts and provisions for estimated warranty cost are examples of temporary differences that create deferred tax assets. These are because they reduce taxable income in the current period but are expected to reverse in the future, resulting in taxable income in the future period. Therefore, both provisions must be taken into account to calculate deferred tax assets. Options A, C, and D are incorrect because they do not create temporary differences that result in deferred tax assets.

USGAAP and IFRS Require That Some Temporary Differences Create Deferred