The accountant for Shell strop Ltd. (SL) is preparing the company's deferred tax calculation for its financial
Question:
The accountant for Shell strop Ltd. (SL) is preparing the company's deferred tax calculation for its financial statements. SL has a deductible temporary difference as a result of a loss carryforward and a taxable temporary difference as a result of its depreciable property, plant, and equipment. SL reports under IFRS. Which of the following statements is true regarding the measurement of SL's deferred income tax asset and liability?
A. The deferred tax asset and liability are discounted.
B. Deductible and taxable temporary differences are not permitted to be net against each other, resulting in both a net taxable and a net deductible temporary difference.
C. Deferred income tax expense to recognize in the statement of comprehensive income is the difference between the opening and closing balances in the SFP deferred income tax accounts.
D. Under IFRS, the deferred income tax asset or liability is classified as current.
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones