Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Financial Statements of a Company

Question:

Taxable income different from.............income.

Options:

Accounting

Deferred

Economic

None of these

Correct Answer:

Accounting

Explanation:

Accounting income is the difference between the revenue earned and expenses incurred by an entity, as computed from its books of accounts. Taxable income is the resultant income computed after making allowances and disallowances to accounting income in line with tax laws. The difference between the two makes the deferred tax liability/asset.