Jaboy IncWas Incorporated Three Years Ago

Multiple Choice

Jaboy Inc.was incorporated three years ago.In its first year,Jaboy capitalized $72,000 organizational and start-up costs for tax purposes.However,it expensed these costs for financial statement purposes.Which of the following statements is true?

A) As a result of the accounting difference three years ago,Jaboy has a $4,800 favorable book/tax difference in the current year.
B) As a result of the accounting difference three years ago,Jaboy has a $4,800 unfavorable book/tax difference in the current year.
C) The accounting difference three years ago has no book/tax consequence in the current year.
D) None of the above is true.