Question
If an expense is recognized earlier for tax than for accounting, what is the likely deferred tax effect?
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Answer
A DTL, because tax payments are reduced today.
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Question
How can you predict whether a temporary difference will reverse?
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Answer
Ask whether tax and accounting recognition timing eventually switches.
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Question
What makes a difference between accounting profit and taxable income permanent rather than temporary?
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Answer
It never reverses in future periods.
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Question
What makes a difference between accounting profit and taxable income temporary rather than permanent?
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Answer
It reverses in a future period.
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