An income tax accrual at yearend will most likely

Name: An income tax accrual at yearend will most likely
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Question

Quizplus · Accepted Answer

An income tax accrual at year-end increases the company's liabilities (as it is an amount owed to the government) without immediately affecting its assets, thereby reducing net income. This reduction in net income leads to a decrease in earnings per share (EPS) because EPS is calculated by dividing the net income by the number of outstanding shares.

An Income Tax Accrual at Yearend Will Most Likely