Deferred taxes are caused by using different accounting methods for tax and financial reporting purposes.

Name: Deferred taxes are caused by using different accounting methods for tax and financial reporting purposes.
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Question

Quizplus · Accepted Answer

Deferred taxes arise due to temporary differences in accounting methods used for tax purposes and financial reporting purposes. This creates timing differences that result in deferred tax assets or liabilities on companies' balance sheets.

Deferred Taxes Are Caused by Using Different Accounting Methods for Tax