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You are assisting LipidCo, a U.S. corporation subject to GAAP, to determine its current-year book expense...

You are assisting LipidCo, a U.S. corporation subject to GAAP, to determine its current-year book expense for income taxes. The following represent the steps that you will take in making this computation. Put the steps into the correct order. (you can number them from 1-7).

A. Compute the deferred tax provision.

B. Determine book income before income tax effects.

C. Determine the current tax provision.

D. Determine whether a valuation allowance is required and apply or release it.

E. Identify and measure temporary book-tax differences.

F. Prepare the disclosures for the financial statement footnotes.

G. Add/Subtract any permanent book-tax differences.

Business   Accounting   
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Answer #1
A. Compute the deferred tax provision. 5
B. Determine book income before income tax effects. 1
C. Determine the current tax provision. 2
D. Determine whether a valuation allowance is required and apply or release it. 6
E. Identify and measure temporary book-tax differences. 3 or 4
F. Prepare the disclosures for the financial statement footnotes. 7
G. Add/Subtract any permanent book-tax differences. 4 or 3
here Temporary or permanent difference both process are interchangeable hence can be perform one afetr another.
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