The FASB decided that the allocation of income taxes paid to operating,financing,and investing activities would be complex and arbitrary,and relied on which one of the following justifications for its decision?

Question

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The FASB relied on the cost-benefit constraint as a justification for its decision to not allocate income taxes paid to operating, financing, and investing activities. This decision was based on the fact that the allocation would be complex and arbitrary, and the cost of implementing such a requirement would outweigh the benefit of the information provided to users. Therefore, the FASB decided to require only the disclosure of income taxes paid in the financial statements.

The FASB Decided That the Allocation of Income Taxes Paid