In applying intraperiod income tax allocation to discontinued operations, extraordinary items, cumulative effects of changes in accounting principles, and prior period adjustments, what tax rate should be used?

Question

Quizplus · Accepted Answer

The marginal (incremental) income tax rate should be used in applying intraperiod income tax allocation to these items because they are usually one-time events that do not represent the ongoing operations of the company. Therefore, the tax rate that reflects the incremental tax impact of these items is the most appropriate choice.

In Applying Intraperiod Income Tax Allocation to Discontinued Operations, Extraordinary