A deferred income tax asset is created when the difference will result in
A)higher income tax payable in the future.
B)no income tax payable in the future.
C)lower income tax payable in the future.
D)none of the above.

Question

Quizplus · Accepted Answer

A deferred income tax asset is created when there is a difference between the tax basis and the carrying amount of an asset or liability, and this difference will result in a lower income tax payable in the future. This means that the asset will be able to reduce the company's future tax liability, resulting in a deferred tax benefit or asset.

A Deferred Income Tax Asset Is Created When the Difference