McGraw-Hill's Taxation of Individuals and Business Entities 3rd Edition by Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver

Exercise 14

Which of the following evidence would not be considered positive in determining whether Adams Corporation needs to record a valuation allowance for some or all of its deferred tax assets?
a.The Company forecasts future taxable income because of its backlog of orders
b.The Company has unfavorable temporary differences that will create future taxable income when they reverse
c.The Company has tax planning strategies that it can implement to create future taxable income
d.The Company has cumulative net income over the current and prior two years
e.The Company had a net operating loss carryover expire in the current year