Question

Each of the following generates a permanent difference between book and taxable income, except Multiple Choice...

Each of the following generates a permanent difference between book and taxable income, except

Multiple Choice

  • Political contributions

  • Section 179 depreciation deduction

  • Deduction for entertainment expenses

  • Tax credits

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Your required answer is option B i.e. Section 179 depreciation deduction.

Explanation:

Permanent Difference arises between books and taxable income since the amount recorded in books is not always or 100% allowed for calculation of taxable income and even in future it does not compensate or set off to each other.

Political contribution, Deductionn for entertainment expense and Tax Credit is permanent difference however section 179 depreciation deduction is allowed as per IRS and the difference is considered as temporary difference beacause after a time it will be reversed.

Thanks!

Please drop an upvote if you find this helpful.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
If a firm has a permanent difference between book income and taxable income for the year,...
If a firm has a permanent difference between book income and taxable income for the year, but NO (change in) temporary differences for the year, then A. tax expense on book income would be the same as the statutory rate B. tax expense must exceed the tax payable for the year. C. the tax payable must exceed the tax expense for the year. D. tax expense would equal the tax payable for the year.
Which of the following is not an example of a permanent difference between pretax financial income...
Which of the following is not an example of a permanent difference between pretax financial income and taxable income? Question 1 options: A) Interest earned on tax exempt municipal bonds is included in pretax financial income B) Straight-line depreciation is expensed for financial accounting purposes but accelerated depreciation is used for income tax purposes C) Fines related to the violation of law D) All of these are permanent differences between pretax financial income and taxable income
An item that would create a permanent difference in pretax financial income, and taxable income would...
An item that would create a permanent difference in pretax financial income, and taxable income would be: Question 7 options: 1) using accelerated depreciation for tax purposes and straight-line depreciation for book purposes. 2) receiving cash in advance for revenue to be earned next year. 3) earning interest revenue from tax-free municipal bonds. 4) none of the above would create a permanent difference.
When accounting for income taxes, a permanent difference occurs in which of the following scenarios? Multiple...
When accounting for income taxes, a permanent difference occurs in which of the following scenarios? Multiple Choice The accrual method of accounting is used. An item is included in the calculation of net income in one year and in taxable income in a different year. An item is included in the calculation of net income, but is neither taxable nor deductible. An item is treated identically for financial and for tax purposes.
Which of the following would result in a reduction of taxable income? Multiple Choice tax credits...
Which of the following would result in a reduction of taxable income? Multiple Choice tax credits portfolio income earned income business income union dues
Goff Inc.'s taxable income is computed as follows: Book income before tax $ 1,016,200 Net permanent...
Goff Inc.'s taxable income is computed as follows: Book income before tax $ 1,016,200 Net permanent differences 77,930 Net temporary differences 475,200 Taxable income $ 1,569,330 Goff's tax rate is 21%. Which of the following statements is true? Multiple Choice 1)The permanent differences caused a $16,365 net increase in Goff's deferred tax liabilities. 2)The permanent differences caused a $16,365 net increase in Goff's deferred tax assets. 3)The temporary differences caused a $99,792 net increase in Goff's deferred tax assets. 4)The...
For 2021, Bastion Partners reported the following: Pretax accounting income $ 181,300 Permanent differences (14,700 )...
For 2021, Bastion Partners reported the following: Pretax accounting income $ 181,300 Permanent differences (14,700 ) 166,600 Temporary difference-depreciation (11,300 ) Taxable income $ 155,300 Cumulative future taxable amounts from temporary differences: As of December 31, 2020 $ 12,700 As of December 31, 2021 $ 24,000 Bastion's tax rate is 21% for 2020 and thereafter. Bastion's deferred tax liability balance as of December 31, 2021 is? Multiple Choice $24,000. None of these answer choices are correct. $5,040. $3,937.
Determine taxable income in each of the following instances. Assume that the corporation is a C...
Determine taxable income in each of the following instances. Assume that the corporation is a C corporation and that book income is before any income tax expense. Book income of $61,000 including capital gains of $6,000, a charitable contribution of $1,600, and meals and entertainment expenses of $8,500. Book income of $103,000 including capital losses of $7,000, a charitable contribution of $17,500, and meals and entertainment expenses of $2,000. Book income of $81,500 including municipal bond interest of $1,500, a...
Define in detail the following types of differences between financial accounting income and taxable income give...
Define in detail the following types of differences between financial accounting income and taxable income give multiple examples of each: Temporary Permanent
The Loquat Corporation has book net income of $139,600 for the current year. included in this...
The Loquat Corporation has book net income of $139,600 for the current year. included in this figure are the following items which are reported on the corporation schedule M1 reconciliation of income loss for goods within camper return. federal income tax expense $20,940 depreciation deduction on the books which is not deductible for tax purposes 27 920 deduction for 50% of meals and entertainment expense which is not allowed for tax purposes 12,564 deduction for a tax penalty not allow...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT