Company A is using the S/L depreciation method for financial statement purposes. This year, the annual depreciation expense is 300,000. For tax purposes, they are using the MACRS accelerated depreciation method, and the annual depreciation expense is 400,000. The difference creates a:

A N/A, using different depreciation methods for book and tax purposes will not create a deferred tax asset or liability

B Deferred tax asset

C Deferred tax liability