Accounting · Accounting Standard 22 (AS 22) - Deferred Tax

Given below are two statements: one is labelled as Assertion A and the other is labelled as Reason R. Assertion A: A Deferred Tax Liability (DTL) is recorded in the balance sheet when the accounting profit of an enterprise exceeds its taxable profit for the current period. Reason R: Under the framework of AS 22, timing differences arise when items like accelerated depreciation under tax laws reduce current taxable income relative to book profit, creating an obligation for higher taxes in future periods. In the light of the above statements, choose the most appropriate answer from the options given below: