Solved

Permanent Differences

Question 56

Multiple Choice

Permanent differences:

A) arise due to differences between income tax legislation and accounting rules, in a particular period, and are reversed in subsequent periods.
B) are accounted for by creating and/or passing entries through to "Deferred Tax Assets" and "Deferred Tax Liabilities" accounts.
C) must be considered, and accounted for, by the creation of deferred tax asset and liabilities for all balance sheet items (e.g., including asset revaluations) , rather than just income statement items, which is a major change created by the new standard.
D) arise due to differences between income tax legislation and accounting rules, in a particular period, and are reversed in subsequent periods; are accounted for by creating and/or passing entries through to "Deferred Tax Assets" and "Deferred Tax Liabilities" accounts; must be considered, and accounted for, by the creation of deferred tax asset and liabilities for all balance sheet items (e.g., including asset revaluations) , rather than just income statement items, which is a major change created by the new standard
E) None of the given answers.

Correct Answer: