1. Which of the following items results in a temporary difference?

Select one:

A. Sale of an asset resulting in a different amount of gain for book and tax purposes

B. Dividend received deduction on the income tax return

C Interest income from a tax-exempt municipal bond

D. Excess tax benefits from the exercise of a nonqualified stock option (i.e., actual value of option exceeds predicted value for book purposes)

2. The corporate income tax formula includes a taxpayer election to claim the greater of the standard deduction or itemized deductions.

A. True

B. False