One example of a temporary difference between financial and tax reporting results from
A)rent expense.
B)tax-exempt interest from municipal bonds.
C)life insurance proceeds resulting from the death of an executive.
D)depreciation of long-term assets.

Question

Quizplus · Accepted Answer

Depreciation of long-term assets often results in temporary differences between financial and tax reporting because different methods or rates may be used for financial reporting purposes (e.g., straight-line method) and tax purposes (e.g., accelerated depreciation methods), leading to timing differences in the recognition of depreciation expense.

One Example of a Temporary Difference Between Financial and Tax