In computing the change in deferred tax accounts,which of the following tax rates is used?

Question

Quizplus · Accepted Answer

Enacted future tax rates are used to compute the change in deferred tax accounts, as these rates are the legally binding ones that will be in effect when the deferred taxes are ultimately realized or settled. Using current tax rates or past years' tax rates would not provide an accurate estimation of the future tax effect on the deferred tax accounts. Estimated future tax rates may be used if there is no enacted future tax rate available, but they would not be as reliable as an enacted future tax rate.

In Computing the Change in Deferred Tax Accounts,which of the Following