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CA Final Ind AS 12 Income Taxes — practice questions — page 3

Explore 89 free Ind AS 12 Income Taxes questions in CA Final Financialreporting. Open each question or exercise to read its content, reference answers and available explanation.

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Ind AS 12 Income Taxes questions and exercises with answers

Showing questions 61–89 of 89.

Tax effects of a transaction are accounted for:Read the answer and worked solution →Current and deferred tax are recognised in profit or loss except to the extent they arise from OCI or equity items or a:Read the answer and worked solution →Interest received in arrears but taxed on a cash basis creates deferred tax recognised in:Read the answer and worked solution →A change in tax rates alters deferred tax balances even without a change in:Read the answer and worked solution →Tax related to an item recognised in other comprehensive income is recognised in:Read the answer and worked solution →Deferred tax on revaluing PPE is recognised in:Read the answer and worked solution →Tax on items outside profit or loss, if hard to find, is allocated on:Read the answer and worked solution →A transfer from revaluation surplus to retained earnings, if made, is stated:Read the answer and worked solution →Tax paid to authorities on behalf of shareholders on dividends is charged:Read the answer and worked solution →Deferred tax from a business combination affects the amount of:Read the answer and worked solution →An acquirer's own pre-acquisition tax asset change from the combination is:Read the answer and worked solution →Acquired deferred tax benefits found in the measurement period first reduce:Read the answer and worked solution →A share-price-linked future tax deduction is measured at the price on:Read the answer and worked solution →Where the tax deduction exceeds cumulative remuneration expense for share options, the excess tax is recognised:Read the answer and worked solution →Current tax assets and liabilities are offset only if there is a legally enforceable right and the entity intends to:Read the answer and worked solution →Deferred tax assets and liabilities of the same entity may be offset only when they relate to taxes levied by the:Read the answer and worked solution →The tax expense on profit from ordinary activities is presented in:Read the answer and worked solution →Exchange differences on deferred foreign tax balances in profit or loss may be classified as:Read the answer and worked solution →Which is listed as a component of tax expense (income)?Read the answer and worked solution →The relationship between tax expense and accounting profit is explained through a numerical:Read the answer and worked solution →For unrecognised deductible temporary differences and unused losses, disclosure covers the amount and:Read the answer and worked solution →For unrecognised subsidiary-investment liabilities, disclose the:Read the answer and worked solution →A deferred tax asset reliant on future profits needs evidence disclosure when the entity has had a:Read the answer and worked solution →What can make tax expense differ from profit times the rate?Read the answer and worked solution →The average effective tax rate equals tax expense divided by:Read the answer and worked solution →An entity's accounting profit is Rs. 2,500 and the domestic rate is 30%. Tax at the domestic rate is:Read the answer and worked solution →Tax-related contingent liabilities, such as disputes with tax authorities, follow:Read the answer and worked solution →A permanent difference in accounting versus tax treatment gives rise to:Read the answer and worked solution →Deferred tax accounting is relevant to which accounting principle?Read the answer and worked solution →

Worked practice questions

Tax effects of a transaction are accounted for:

  1. Always inside profit or loss
  2. Always directly inside equity
  3. Always against the goodwill
  4. In line with the item itself
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Correct answer: D. In line with the item itself

Tax follows the item: profit or loss items carry tax in profit or loss, while OCI or equity items carry tax outside profit or loss.

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Current and deferred tax are recognised in profit or loss except to the extent they arise from OCI or equity items or a:

  1. A cash sale of goods
  2. A business combination
  3. A bank loan drawdown
  4. A dividend received
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Correct answer: B. A business combination

Tax on business combination effects flows into goodwill or bargain purchase gain instead of profit or loss.

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Interest received in arrears but taxed on a cash basis creates deferred tax recognised in:

  1. Equity reserves
  2. Revaluation reserve
  3. Profit or loss
  4. Goodwill account
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Correct answer: C. Profit or loss

Income is in accounting profit in one period and taxable profit in another, so deferred tax goes to profit or loss.

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More Financialreporting topics

Ind AS 116 LeasesInd AS 36 Impairment of Assets and Ind AS 38 Intangible AssetsInd AS 24 Related Party Disclosures and Ind AS 108 Operating SegmentsInd AS 1 Presentation of Financial StatementsInd AS 113 Fair Value MeasurementInd AS 109 Financial InstrumentsInd AS 23 Borrowing Costs and Ind AS 40 Investment PropertyInd AS 103 Business Combinations