1. Deferred income taxes (payable) in the liabilities section of the Balance She
ID: 2467583 • Letter: 1
Question
1. Deferred income taxes (payable) in the liabilities section of the Balance Sheet for Microsoft dated 6/30/15 arose from which of the following situations?
Microsoft paid more income taxes to the IRS than what their external GAAP income statement showed they owed.
Microsoft paid less income taxes to the IRS than what their external GAAP income statement showed they owed.
Microsoft did not pay what they owed to the IRS, so now they are making installment payments including a large penalty.
Microsoft had additional cash reserves that they lent to the IRS.
Explanation / Answer
Deferred Income Taxes payable in the Liabilities Section of the Balance Sheet for Microsoft dated 6/30/15 arose from the fact that Microsoft paid less income taxes to the IRS than what their external GAAP Income Statement showed they owed.
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