The 2016 Form 10-K of Dow Chemical disclosed the following: Deferred tax assets increased by $939...
The 2016 Form 10-K of Dow Chemical disclosed the following:
Deferred tax assets increased by $939 million and deferred tax
liabilities increased by $336 million.
How do these balance-sheet changes affect tax expense on the income
statement for the year?
Select one:
A. Increase tax expense by $1,275 million
B. Decrease tax expense by $1,275 million
C. Increase tax expense by $603 million
D. Decrease tax expense by $603 million
E. None of the above
Homework Answers
Changes in the deferred tax asset account inversely affect tax expense. Changes in the deferred tax liability account directly affect tax expense.
=-939 million +336 million
=-603
The answer is:
D. Decrease tax expense by $603 million
Add Answer to:
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