DTA/DTL

Question 1

TAXABLE REVENUES LATER [TRL] = DEFERRED TAX LIABILITY

Answer 1

[ICE-GI]

1. Involuntary conversion of nonmonetary asset which is recognized under Book but deferred for Tax
2. Contractors Accounting (Percentage of Completion vs. Completed Method
3. Equity Method (Undistributed dividends) for Book and cost method for Tax.
4. G – Gains > Unrealized holding gains under Book (including the FV option), but deferred under Tax.
5. Installment Sales

Question 2

DEDUCTIBLE EXPENSES NOW [DEN] = DEFERRED TAX LIABILITY

Answer 2

1. Amortization of Franchise
2. Depreciable Property
3. Depletable Resources
4. Prepaid expenses that are deducted on the tax return in the period paid

Question 3

DEDUCTIBLE EXPENSES LATER [DEL] = DEFERRED TAX ASSET

Answer 3

1. Bad Debts Expense (Allowance vs. Direct Write-Off)
2. Organizational Costs
3. Warranty Liabilities
4. Litigation accruals
5. Loss - Unrealized holding losses under Book (including the use of FV option) but deferred under Tax
6. Estimated liabilities related to discontinued operations or restructurings
7. Stock-Based Compensation Expense
8. Start-up Costs

Question 4

TAXABLE REVENUES NOW [TRN] = DEFERRED TAX ASSET

Answer 4

[SPS]

1. Subscriptions Received in Advance
2. Prepaid Rent/Interest/Royalties/Contracts
3. Sales and leasebacks under Book (income deferral) but reported as sales under Tax