Which of the following circumstances creates a future taxable amount?

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C) Straight-line depreciation for financial reporting and accelerated depreciation for tax reporting creates a future taxable amount because, initially, the tax depreciation exceeds the book depreciation, leading to lower taxable income in the early years. However, in later years, as the accelerated depreciation decreases and the straight-line depreciation remains constant, taxable income will increase, creating a future taxable amount.

Which of the Following Circumstances Creates a Future Taxable Amount