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MJB91

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  • in reply to: Carrying Amount Vs. Tax Base #83096
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      • CFA Level 2
      16 Jul 2018 at 8:55 am
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      Because the inventory has been expensed it will be taxable on the income statement. As for tax purposes it has been capitalized it will not be subject to the same levels of tax within the first year. This will create deferred tax asset as you have paid tax in year 1 due to expensing. Does that make sense?

      in reply to: Cash flow from operation #83095
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        • CFA Level 2
        16 Jul 2018 at 8:41 am
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        Hi Wannabe1988 – The interest and dividends will already have been taken into account within the net income. You won’t need to readjust for them. Does that make sense?

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