Home › CBSE Class 11 (Commerce) › Accountancy › Depreciation, Provisions and Reserves › Which statement about taxable profit is correct?
Which statement about taxable profit is correct?
AReserves reduce taxable profit
BProvisions are made after tax
CProvisions reduce taxable profit
DNeither affects taxable profit
Answer & Solution
Correct answer: C. Provisions reduce taxable profit
A provision is deducted before taxable profit is found, while a reserve is made from profit after tax.
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