When depreciation is being overcharged from an economic entity point of view resulting from equipment being sold at a profit between a parent and a subsidiary, the tax effect consolidation adjustment for the depreciation will:

Question $3$ Answer

a$.$

Dr$.$ Deferred tax liability

b$.$

Cr$.$ Deferred tax asset

c$.$

Cr$.$ Deferred tax liability

d$.$

Dr$.$ Deferred tax asset

e$.$

Cr$.$ Income tax expense