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Xyz corp. recently reported a valuation allowances on deferred tax assets of $477,000. If instead the company had increased the allowance to $2million, what impact
Xyz corp. recently reported a valuation allowances on deferred tax assets of $477,000. If instead the company had increased the allowance to $2million, what impact would this change have on net income for the year?
a.it would decrease net income by 1,523,000
b. it would increase net income by 1,523,000
c. it would not affect the net income, which is calculated net of any valuation allowance
d. it is not possible to determine because total deferred tax expense is not broken down
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