Asked by Samira Saghafi on Apr 24, 2024
Verified
Which of the following accounts cannot be altered by a consolidation adjusting entry?
A) Income tax expense
B) Income tax payable
C) Deferred tax asset
D) Deferred tax asset.
Deferred Tax Asset
Financial accounting that recognizes reduced income tax in the future due to deductible temporary differences and carryforwards.
- Absorb the principles of accounting for intragroup sales, with an emphasis on understanding the tax impact and the nuances of deferred tax.
Verified Answer
PN
Patricia Nicole RodriguezMay 02, 2024
Final Answer :
B
Explanation :
Income tax payable is a current liability account that reflects the amount of income tax that a company owes to the government as of the balance sheet date. This account cannot be adjusted through a consolidation entry because it accurately reflects the entity's obligation to pay taxes. The other three accounts may require adjustment to ensure that the consolidated financial statements reflect the correct amount of income tax expense and deferred tax assets/liabilities.
Learning Objectives
- Absorb the principles of accounting for intragroup sales, with an emphasis on understanding the tax impact and the nuances of deferred tax.
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