If a valuation allowance is decreased released) in the current year, the corporation's effective tax rate is lower than had the valuation allowance not decreased.

Question

Quizplus · Accepted Answer

A decrease (release) in the valuation allowance reduces the income tax expense, thereby lowering the effective tax rate compared to what it would have been if the valuation allowance had not decreased.

If a Valuation Allowance Is Decreased Released) in the Current