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Taxable income of a corporation differs from pretax financial income because of ?

Permanent               Temporary

Differences               Differences

    a.     No                                  No

    b.    No                                 Yes

    c.    Yes                                Yes

    d.    Yes                                 No

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Question added by Moataz Elsabawy , مدير مالى , مجموعه شركات الانصار
Date Posted: 2017/06/30
Marvin Villareal
by Marvin Villareal , Accounts Manager , TOYOTA ABDUL LATIF JAMEEL

Taxable income differs from pretax financial income due to permanent and temporary differences. Temporary difference will reverese in the future while permanent difference will not reverse.

Moataz Elsabawy
by Moataz Elsabawy , مدير مالى , مجموعه شركات الانصار

Option C is the correct answer . Both of the two differences make the pretax financial income and taxable income differs . But deferred tax account arises  from temporary differences only.