The Accounting Review Vol. 27 No. 4 1952
ACCOUNTING PRINCIPLES AND TAXABLE INCOME.
Abstract
1. In the several statements of "Accounting Concepts and Standards Underlying Corporate Financial Statements" issued by committees of the American Accounting Association in 1936, 1941, and 1948, fundamental a concerning the functions of accounting in respect to revenue realization, costs, income, and capital were set forth. The objective in so doing was to present a coordinated statement of principles and suggested applications representing levels of accounting practice "departures from which should be viewed with concern." 2. Under the tax laws of the United States, Congress has enacted taxes on the net incomes of corporation. In the enactment of then laws and in their administration, by regulation or as a result of Court decisions, there have developed determinations of net income for financial statement purposes under generally accepted accounting principles. 3. These income between taxable income and accounting net income may be classified generally into two principal categories: deny or limit deductions as a matter of economic control or for purposes of raking revenue. (b) Differences of timing-those which the time of recognition of income or of deductions, usually resulting from legalistic interpretations of the tax statutes by Court or regulative decisions (thereby setting a precedent for subsequent administration). 4. The differences result largely from differences in purpose. The purpose of the revenue laws is to establish practical formulae for the collection of taxes (and at times to regulate the economy).
- DOI
- 10.2308/tar-7086888
- Volume
- 27
- Issue
- 4
- Pages
- 427-430
- Language
- en
- Sources
- crossref openalex