Which of the following best describes the focus of ASC 740?

Question

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ASC 740 uses an "asset and liability approach" that focuses on the balance sheet. This approach requires companies to recognize deferred tax assets and liabilities on their balance sheet, reflecting the differences between the tax basis and the book basis of their assets and liabilities. The income tax expense reported on the income statement is calculated based on changes in these deferred tax balances.

Which of the Following Best Describes the Focus of ASC