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Identifying Tax Differences Listed below are ten separate situations. For each item indicates whether the differences is ( 1 ) temporary creating a deferred tax
Identifying Tax Differences Listed below are ten separate situations. For each item indicates whether the differences is temporary creating a deferred tax asset or a deferred tax liability or permanent. tabletableDeferredAccountItem,Asset,Liability,PermanentPension fund contributions are less than pension expense for the current year, resulting in a pension liability on the company's balance sheet.,,,Dividend revenue recognized for accounting while a portion is deductible for taxes dividends received deductionEstimated warranty costs: accrual basis for accounting and cash basis for income tax.,,,Fines expensed for accounting but not deductible for tax purposes.,,,Straightline depreciation for accounting and accelerated depreciation for income tax.,,Unrealized gain on investments: FVNI recognized for accounting, but gain recognized only on disposal of the asset for income tax.,,,Rent revenue collected in advance: accrual basis for accounting, cash basis for income tax.,,,Unrealized loss on investments: FVNI recognized for accounting, but loss recognized only on disposal of the asset for income tax.,,,Probable and estimable litigation contingency: accrual basis for accounting and cash basis for income tax.,,,Interest received on investments in municipal bonds is not taxable.,,,
Identifying Tax Differences
Listed below are ten separate situations. For each item indicates whether the differences is temporary creating a deferred tax asset or a deferred tax liability or permanent.
tabletableDeferredAccountItem,Asset,Liability,PermanentPension fund contributions are less than pension expense for the current year, resulting in a pension liability on the company's balance sheet.,,,Dividend revenue recognized for accounting while a portion is deductible for taxes dividends received deductionEstimated warranty costs: accrual basis for accounting and cash basis for income tax.,,,Fines expensed for accounting but not deductible for tax purposes.,,,Straightline depreciation for accounting and accelerated depreciation for income tax.,,Unrealized gain on investments: FVNI recognized for accounting, but gain recognized only on disposal of the asset for income tax.,,,Rent revenue collected in advance: accrual basis for accounting, cash basis for income tax.,,,Unrealized loss on investments: FVNI recognized for accounting, but loss recognized only on disposal of the asset for income tax.,,,Probable and estimable litigation contingency: accrual basis for accounting and cash basis for income tax.,,,Interest received on investments in municipal bonds is not taxable.,,,
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