Which of the following is true about intraperiod tax allocation?
A) It arises because certain revenue and expense items appear in the income statement either before or after they are included in the tax return.
B) It is required for extraordinary items and cumulative effect of accounting changes but not for prior period adjustments.
C) Its purpose is to allocate income tax expense evenly over a number of accounting periods.
D) Its purpose is to relate the income tax expense to the items which affect the amount of tax.

Question

Quizplus · Accepted Answer

Intraperiod tax allocation is the process of relating the income tax expense to the items that affect the amount of tax by allocating the income tax expense to the specific income or expense items that created it. This allows for a better understanding of the true tax effects of these items on the income statement.

Which of the Following Is True About Intraperiod Tax Allocation