If a country's accounting income does not differ significantly from its taxable income, one would reasonably expect:
A) extreme conservatism on the part of accountants.
B) a significant amount of deferred taxes on the balance sheet.
C) that the use of LIFO would be more prevalent.
D) extreme conservatism on the part of accountants as well as increased use of LIFO.

Question

Quizplus · Accepted Answer

If accounting income and taxable income do not differ significantly, it suggests that accountants are applying conservative accounting principles, as they are not taking advantage of potential tax deferrals or other accounting methods that could create timing differences.

If a Country's Accounting Income Does Not Differ Significantly from Its