Any difference that arises from the use of capital cost allowance CCA) for tax purposes and amortization methods for accounting purposes is referred to as an):
A)undepreciated capital cost.
B)temporary difference.
C)future income tax liability.
D)future tax asset.

Question

Quizplus · Accepted Answer

The difference that arises from the use of different depreciation methods for tax and accounting purposes is known as a temporary difference, as it is expected to reverse in the future. The other options (undepreciated capital cost, future income tax liability, and future tax asset) refer to specific concepts related to temporary differences, but they do not fully encompass the question being asked.

Any Difference That Arises from the Use of Capital Cost