alleryStart learning →The financial statements recognise the tax effect of which transactions?
AOnly cash transactions
BAll transactions of that period
COnly capital transactions
DOnly related party deals
Answer & Solution
Correct answer: B. All transactions of that period
Both current and deferred tax effects of all transactions occurring in the period are recognised.
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Related questions
Section 43B allows certain expenses such as taxes, duty, cess and fees on which basis?A difference in depreciation method, such as SLM against WDV, between books and tax is a:Payments to non-residents disallowed under section 40(a)(i) until tax is deducted give a:Income spread over several years in the accounts but fully taxed on receipt creates a:Income credited to the profit and loss statement but taxed only in later years creates a:If an asset's tax base is lower than its book value, the company recognises a:A bad debts provision is expensed in books but tax relief comes only when it is utilised. Deferred tax liabilities generally arise when tax relief is given: