Changes in enacted tax rates only affect income tax expense in the years those changes affect tax payable.

Name: Changes in enacted tax rates only affect income tax expense in the years those changes affect tax payable.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Changes in enacted tax rates affect both the current income tax expense and the deferred tax balances. Deferred taxes must be adjusted in the period the tax rate change is enacted to reflect the rate at which they are expected to reverse in the future.

Changes in Enacted Tax Rates Only Affect Income Tax Expense