1.A net operating loss carryback will create a deferred tax liability.
2.Research and development costs reported in the income statement but elected to be capitalized and amortized over five years for tax purposes would create a deferred tax asset in the year of origination.
3.Warranty expenses accrued in the year of product sales and reported in the income statement but expensed as incurred on the tax return in a later period would create a deferred tax asset in the year of origination.
4.Deferred tax amounts correctly classified as current should be offset (netted together) and shown as a single current amount on the Balance Sheet (i.e., either a deferred tax asset or a deferred tax liability).
5.Under a defined contribution pension plan, retirement income to participants depends on the size of the fund at retirement.
6.The vested benefit obligation is reduced when vested employees leave the organization for employment elsewhere.
7.Cash contributions to the pension fund by an employer will reduce its projected benefit obligation.