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Types of temporary differences
There are two main types of temporary differences;1) Taxable temporary difference:
If the carrying amount is more than the tax base then it means that this difference is taxable and the firm will end up paying some tax in the future. Therefore all taxable temporary differences lead to deferred tax liability.2) Deductible temporary differences:
If the tax box is more than the carrying amount, then the firm will end up saving some tax in the future because the amounts due from the tax authorities will be deducted from the future taxes. Therefore, all deductible temporary differences will lead to deferred tax assets.
a. Explain a major factor which led to the introduction of International Financial Reporting Standards (IFRS). b. Explain how users of financial information benefit from IFRS.
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How do you show bond amortization on a spreadsheet and then in journal entries and compute interest payments?
Internal Rate of Return
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