Increases preference shares outstanding.

Has no effect on preference shares outstanding.

Increases authorized preference share capital
Decreases authorized preference share capital

Which is true about intraperiod tax allocation? * 16-37# 3

1 point

Intraperiod tax allocation arises because certain items are recognized for accounting and tax
purposes.
Intraperiod tax allocation is required for the effect of accounting estimates.
The purpose is to relate the income tax expense to the items which affect the amount of tax.
The purpose is to allocate income tax expense evenly over a number of accounting periods.

A temporary difference which would result in a deferred tax liability is * 16-36 # 3

On September 1, 2020, SMD Company borrowed P5,000,000, 10% interest-bearing

note due in five years. On December 31, 2020, the fair value of the note is determined
to be P4,350,000. The entity elected irrevocably the fair value option in measuring the
note payable. What amount of gain/loss from change in fair value of the note payable
should be reported for 2020? *
2 points

P1,250,000 gain
P1,250,000 loss
P650,000 gain
P650,000 loss