The deferred income tax liability:
A)Arises when income tax expense reported on the income statement exceeds the amount of income taxes payable to the government.
B)Is a contingent liability.
C)Arises when income tax expense reported on the income statement is less than the amount of income taxes payable to the government.
D)Is never recorded.
E)Is recorded whether or not the difference between taxable income and financial accounting income is permanent or temporary.

Question

Quizplus · Accepted Answer

Deferred income tax liability arises when the income tax expense reported on the income statement exceeds the amount of income taxes payable to the government, due to temporary differences.

The Deferred Income Tax Liability