Using different depreciation methods for book purposes versus tax purposes for the same asset is
A)not allowed since the amount can only be calculated one way or the other,not both.
B)the direct result of the differing goals of financial and tax accounting.
C)contrary to GAAP.
D)against the Internal Revenue Code,and as such,against the law.

Question

Quizplus · Accepted Answer

Financial accounting and tax accounting have different objectives and, therefore, use different depreciation methods. Financial accounting is concerned with presenting an accurate financial picture of the company, while tax accounting is concerned with minimizing the tax liability. Consequently, the two methods may differ in the depreciation amount and useful life of an asset.

Using Different Depreciation Methods for Book Purposes Versus Tax Purposes