Post Utme Caleb University 2019 Accounting Question 6

Practice objective / multiple choice question 6 from the 2019 Post Utme Caleb University Accounting examination.

Post Utme Caleb University 2019 Accounting Objective / Multiple Choice
Question 6 POST_UTME_CALEB_UNIVERSITY • 2019 • ACCOUNTING • objective

A company's accounting policy requires that depreciation be calculated using the straight-line method. However, the company's management has decided to use the reducing balance method for tax purposes. What is the effect of this change on the company's financial statements?

Answer Options

A. The company's net income will increase.
Correct Answer B. The company's net income will decrease.
C. The company's tax expense will increase.
D. The company's tax expense will decrease.
Correct Answer
B
Correct Option:
The company's net income will decrease.

About This Question

This is Post Utme Caleb University 2019 Accounting Question 6. It is one of the objective questions from the 2019 Post Utme Caleb University Accounting examination.

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