One Reason That Tax Accounting Rules Differ from Generally Accepted

Multiple Choice

One reason that tax accounting rules differ from generally accepted accounting principles is that:

A) Taxpayers often tend to overstate income, and companies tend to understate income when reporting to shareholders.
B) Taxes are rarely disputed, so there is less need for verifiability in tax rules.
C) The tax code tries to follow the economic substance of transactions, but generally accepted accounting principles focus on their legal form.
D) Congress has decided that some actions should not be rewarded by tax deductions, even though they may meet the accounting definition of expenses.