Class 12 Accounts Notes: Depreciation and Deferred Taxes Notes PDF

Description

Class 12 Accounts Notes: Depreciation and Deferred Taxes Notes PDF

Depreciation and Deferred Taxes
Tax Depreciation
„ Accelerated depreciation
„ No judgment in determining depreciation expense
„ Tax Reporting
≠ Financial Reporting ==> timing
differences in measurement of income
„ Why would a firm prefer accelerated depreciation for tax
purposes?
„ Why does government allow this?
„ Why not use the tax method for financial reporting?
„ Different depreciation for tax and financial reporting
gives rise to Deferred Taxes

Total Pages – 4

PDF Size – 135 KB