Explain tax-planning strategy, Accounting Assignment Homework Help

May 24th, 2016
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Question description

SFAS No. 109 uses the term "tax-planning strategy." The meaning of this term in the pronouncement is somewhat different from its usage in ordinary business conversation. Typically, one would expect the term tax-planning strategy to connote the actions management takes to minimize the enterprise’s long-run tax obligation. An enterprise may, for example, structure its credit sales activities such that these sales would qualify for treatment as installment sales for tax purposes. Such an approach would allow the deferral of taxable revenue until cash is actually received. The use of the term tax-planning strategy in SFAS No. 109 differs from the traditional use, however.


Explain the meaning of the term “tax-planning strategy” as the term is used in SFAS No. 109.

The writing assignment will demonstrate writing across the curriculum responding to the topic selected in a 500-700 words paper - APA Format with 1 reference

Tutor Answer

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School: University of Virginia
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hey there. here is your document. i have presented the difference between of the term used in SFAS and common perception

RUNNING HEAD: Tax-planning strategy: SFAS vs. Common perception

Tax-planning strategy: SFAS vs. Common perception

RUNNING HEAD: Tax-planning strategy: SFAS vs. Common perception

The term “tax-planning strategy” used in SFAS no. 109 describes that the tax collecting by the
governing body should not be the profit or income that can used temporarily for a span of time.
The term recognizes the strategy that multiplies the income or profit with every year. The
governing body or the management team of any institution should find that plan that involves the
strategies which they are not intended to impl...

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