S & C Company's net income before taxes is $400,000,and income tax expense is $125,000.S & C records a valuation allowance of $25,000.What is S & C's effective tax rate before and after recording the valuation allowance?
A) 31% and 25% respectively
B) 25% and 33% respectively
C) 31% and 38% respectively
D) There would not be a change in ETR because these are due to temporary differences.
Correct Answer:
Verified
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