Question

which of the following items are classified as deferred tax liabilities? (select all that apply.) multiple select question. warranty expense in excess of warranty deductions. bad debt deductions in excess of bad debt expense. depreciation deducted for tax in excess of depreciation expense. rent received in advance not included in financial income.

Answer 1

Deferred tax liabilities are taxes that will be paid in the future due to temporary differences between tax and financial reporting. Examples include excess depreciation deductions, excess bad debt deductions, and unearned rent.

Step-by-step explanation:

Deferred tax liabilities refer to taxes that will be paid in the future due to temporary differences between the timing of recognition of revenue or expense for tax purposes and financial reporting purposes.

Out of the options provided:

1. Depreciation deducted for tax in excess of depreciation expense would be classified as a deferred tax liability because it represents a timing difference between the tax deduction taken for depreciation and the expense recognized in the financial statements.
2. Bad debt deductions in excess of bad debt expense would also be classified as a deferred tax liability because it represents a timing difference between the tax deduction for bad debt and the expense recognized for bad debt in the financial statements.
3. Rent received in advance not included in financial income would be classified as a deferred tax liability because it represents a timing difference between the recognition of income for tax purposes and financial reporting purposes.