Jaboy Inc.was incorporated three years ago.In its first year,Jaboy capitalized $72,000 organizational and start-up costs for tax purposes.However,it expensed these costs for financial statement purposes.Which of the following statements is true?
A)As a result of the accounting difference three years ago,Jaboy has a $4,800 favorable book/tax difference in the current year.
B)As a result of the accounting difference three years ago,Jaboy has a $4,800 unfavorable book/tax difference in the current year.
C)The accounting difference three years ago has no book/tax consequence in the current year.
D)None of the above is true.

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The Answer of Jaboy Inc.was incorporated three years ago.In its first year,Jaboy capitalized $72,000 organizational and start-up costs for tax purposes.However,it expensed these costs for financial statement purposes.Which of the following statements is true?
A)As a result of the accounting difference three years ago,Jaboy has a $4,800 favorable book/tax difference in the current year.
B)As a result of the accounting difference three years ago,Jaboy has a $4,800 unfavorable book/tax difference in the current year.
C)The accounting difference three years ago has no book/tax consequence in the current year.
D)None of the above is true.

Jaboy IncWas Incorporated Three Years Ago