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Updated CIMAPRA19-F02-1 Practice Questions BY Phelps

P Uploaded by Phelps 09-Oct-2026 Verified by Experts Based on Latest Exam Syllabus
Question 1

The tax benefit on a company's asset is 180,000 and the useful life on that asset is five years. The company creates a deferred tax provision to spread this benefit over the asset's useful life.

What entry is needed to reduce this deferred tax provision in the company's year two accounts?

  • A. DR Deferred tax liability (SOFP) 36,000
  • B. CR Deferred tax liability (SOFP) 36,000
  • C. DR Corporation tax (income statement) 36,000
  • D. CR Corporation tax (income statement) 36,000
  • E. DR Deferred tax liability (SOFP) 144,000
  • F. CR Deferred tax liability (SOFP) 144,000
  • G. DR Corporation tax (income statement) 144,000
  • H. CR Corporation tax (income statement) 144,000
Updated CIMAPRA19-F02-1 Practice Questions BY Phelps
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