is less Tax on Profit on Sale of Asset and less Operating Costs (revenue and expenses) or (other cash flows)?

Q: In which situation does the tax depreciation allow the firms to defer paying income taxes?

A: Deferment of income tax liability is also called as Deferred Tax Liability. It means tax liability…

Q: If the sale price executes at the price you specified, what would be the total loss, excluding…

A: Sales price when executed at the price specified will be equal to the breakeven price.  Break even…

Q: Why is the after tax cost of debt rather than the before tax cost used to calculate the weighted…

A: Weighted average cost of capital :  WACC or Weighted average cost of capital, as the name suggests,…

Q: reason that depreciation is a source of cash inflow is because

A: Any fixed asset purchased has a fixed life throughout which it has to be used. Over the course of…

Q: Why do many companies use one method to calculate depreciation for the income statement prepared for…

A: Companies use different methods for tax reporting and financial reporting because by using the…

Q: Does the management of long term assets benefit the business in anyway? Are there tax benefits as…

A: Assets  is a resource which has economic value and gives benefit to the company directly and…

Q: The faster an asset can be depreciated, according to IRS rules, the greater a company's after-tax…

A: Depreciation is a process in which, when a business buys or develops an asset, the tax treatment for…

Q: Which of the following statements about depreciation is not true? a. Depreciation helps companies…

A: Depreciation is a reduction in value of tangible fixed non-current assets due to: Constant use Wear…

Q: profit after taxes will be produced

A: A rise in sales will cause a proportional rise in the variable costs. But, the fixed costs will…

Q: Which of the following statements is CORRECT? Profit have no effect on capital Profit will…

A: Profit means the difference between the revenue from operation and total cost . Capital means the…

Q: What is the logic behind allowing tax loss carrybacks/carryforwards?

A: Logic behind allowing tax loss carrybacks and carryforwards: A tax loss carryback permits a company…

Q: For what three main reasons is profit maximization inconsistent with wealth maximization?

A: Profit maximization is the traditional approach which only focuses on increasing the profit of the…

Q: Property and income taxes are more popular than sales taxes and user charges? True or False

A: Taxes are the fees charged by the government to collect revenue and run the country. The money…

Q: A person wonders why the profit after tax is not the same as the cash flows from operating…

A: Step 1 Profit after tax is the amount of profit earned by the company after paying off all operating…

Q: Which of the following payment is a capital expenditure and not deductible under profits tax?

A: 1(a)  Payment to a departing employee agree for not competing with the company.   1(b)  1,3 and 4…

Q: How can we deal with Salvage value and gains tax:?

A: Depreciation: The term depreciation refers to the fall in the monetary value of assets due to its…

Q: What are the short and longer consequences of recognising cable revenue costs as capital spending

A: A company's capital expenditures (CapEx) are cash outlays for the purchase, improvement, and…

Q: What is the difference between a ‘net capital gain’ and a ‘capital gain, and between a ‘net capital…

A: The question is related to Capital Gain head. Capital gain means any profit or gain arising out of…

Q: Is net operational cash flow a better indicator of performance than accrual-based net income in most…

A: Earned income is reported on a company's income statement using the accrual accounting technique…

Q: a. For reporting purposes, management prefers higher profit; for tax purposes, lower taxable income…

A: PLEASE LIKE THE ANSWER, YOUR RESPONSE MATTERS  Identify the best depreciation method: • For the…

Q: Depreciation is needed only for computing income taxes. True or false?

A:

Q: why the tax expense show in the income statement are different from tax paid in cash flow statement

A: Tax:   It is a compulsory payment imposed on individuals or entities on the basis of their income…

Q: Can the net cash flows be viewed as before-tax values or aftertax values for which tax effects have…

A: Cash flow after taxes (CFAT) investigates the capacity of an organization to deliver income from its…

Q: It can be said that the actual cost of an expenditure that is deductible for tax purposes is less…

A: Tax payable is the amount that is to be paid by the tax payer to the tax receivable individual or…

Q: What is depreciation and amortization? What's the difference? It is an accounting concept that has…

A: Depreciation is a charge to account for a reduction in the value of a capital asset arising because…

Q: How does depreciation give tax benefits? What are the advantages of Internal Financing?

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: The disadvantage of actual cash value coverage of personal property compared to replacement cost…

A: Replacement cost coverage is the amount of money incurred in connection with the replacement of a…

Q: Do you believe that the cash flows from the sale of an investment should also include the tax effect…

A: Cash Flows in any entity's books reflect the inflow and outflow of cash during a specified period

Q: Calculate: Tax management efficiency Expense control efficiency Asset management efficiency

A: Tax Management Efficiency = Net IncomeNet operating Income before taxes   Expense Control Efficiency…

Q: Why is the after-tax cost of debt, rather than its before-taxrequired rate of return, used to…

A: The mix of equity and debt is a business organization is known as the capital structure of the…

Q: We tax net income? What economic distortions would occur if we taxed gross receipts?

A: Gross income is the income to the company or an individual after operating activities or providing…

Q: Net capital gain means the excess of the gains from sales of exchanges of ordinary assets over…

A: Capital gain can be defined as the increase in the value of the capital asset. When the selling…

Q: Using tax depreciation for tax purposes and straight-line depreciation for financial reporting, do…

A: Deferred tax liability is the amount of tax that is due for the period but not been paid. It arises…

Q: Net Capital gain is an item of income, while net capital loss is not an item of deduction. a.true…

A: Net capital gains is the gain that arises when the net long term capital gain is more than net short…

Q: EBIT is equivalent to profits after taxes. true or false?

A: EBIT is the earnings before interest and tax.

Q: Illustrate the significance of depreciation and income taxes?

A: Depreciation is the charge against the usage, wear and tear or obsolescence of the asset in the…

Q: Which depreciation method is most common for financial reporting? Which depreciation method is most…

A:

Q: What are the benefits of calculating depreciation differently for financial reports and for tax…

A: Depreciation means decline in the estimation of benefit inside its valuable life because of mileage…

Q: How is a business activity distinguished from an investment activity? why is this distinction…

A:

Q: What is NOPAT (net operating profit after taxes)?

A: The income generated by a business in the course of normal operations, after deducting the direct…

Q: True or false, and explain

A: True. Taxing individuals to provide public goods increases the tax burden of all taxable…

Q: Why company tax rate is always different from company accounting income?

A: There is no possible comparison between the corporate tax rate and accounting income directly. The…

Q: Which of the following has a different treatment for cash and accrual basis of tax accounting?…

A: Under cash basis accounting, the transactions are recorded when the income is actually received or…

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.