list and explain the key terms used in income tax accounting explain why and how def 555781

Analysis of Income Taxes
a. List and explain the key terms used in income tax accounting, explain why and how deferred tax liabilities and assets are created, and describe the liability method of accounting for deferred taxes.
b. Discuss the implications of a valuation allocation (i.e. when it is required, what impact it has on the financial statements, and how it might affect an analyst’s review of a company).
c. Explain the factors that determine whether a company’s deferred tax liabilities should be treated as a liability or as equity for purposes of financial analysis.
d. Distinguish between temporary and permanent items in pretax financial income and taxable income.
e. Compute income tax expense, income taxes payable, deferred tax assets, and deferred tax liabilities.
f. Calculate the adjustment to the financial statements related to a change in the tax rate.