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Listed below are five independent situations. For each situation indicate (by letter) whether it will create (A) a deferred tax asset, (L) a deferred tax
Listed below are five independent situations. For each situation indicate (by letter) whether it will create (A) a deferred tax asset, (L) a deferred tax liability, or (N) neither. TERM PHRASE Research and development costs reported in the income statement but elected to be capitalized 1 and amortized over five years for tax purposes. 2. An operating loss carryforward. Organization costs reported in the income statement but amortized and deducted over five years for tax purposes. 4. Premiums paid on life insurance policies covering key corporate executives. 5. The nondeductible portion of travel and entertainment expenses
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