A favorable temporary book–tax difference is so named because it causes taxable income to decrease relative to book income in the current year.

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A favorable temporary book–tax difference is so named because it causes taxable income to decrease relative to book income in the current year.
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Solution 1

A favorable temporary book-tax difference is called "favorable" because it results in a decrease in taxable income compared to book income in the current year. This means that a company will owe less in taxes in the current year, which is financially beneficial.

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