CFA Practice Question
The balance sheet tax amount that is expected to be recovered from future operations is the definition of the ______.
A. deferred tax asset
B. deferred tax liability
C. deferred income tax expense
Explanation: The deferred tax asset is based on financial reporting as opposed to the tax return.
User Contributed Comments 3
| User | Comment |
|---|---|
| danlan | Does "recovered" mean paid? Is it a deferred tax liability (C)? |
| jayjunk | "recovered" should mean "received" rather than "paid", so "deferred tax asset" is the correct answer. |
| mekc | deferred tax asset = prepaid tax asset |