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23_ H_SHAILEY DRAVID
on Dec 07, 2024

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The tax effect of eliminating the unrealised profit from an intragroup sale of inventories and adjusting the value of the inventories on hand is recognised as:

A) an increase in income tax expense.
B) an increase in deferred tax liability.
C) a decrease in deferred tax liability.
D) an increase in deferred tax asset.

Deferred Tax Asset

A financial item on a company's balance sheet that reduces future tax liabilities due to deductible temporary differences, losses, or credits.

Unrealised Profit

Profit that results from an increase in value of an asset that has not yet been sold and thus has not generated actual cash inflow.

Intragroup Sale

Transactions occurring between entities within the same group or conglomerate, often scrutinized for transfer pricing and tax implications.

  • Discern and calculate the fiscal impacts related to dispelling unrealized profits or losses in interactions between group members.
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katrina owensDec 13, 2024
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