medium · Financial Accounting accounting-cycle-financial-statements

Under the 'integral' approach to interim reporting (ASC 270), how is income tax expense calculated for the first quarter?

1. By performing a full tax return calculation for the three-month period alone.
2. By using the statutory rate for the first three quarters and truing up to the effective rate in Q4.
3. By applying the estimated annual effective tax rate to the year-to-date pretax income.
4. By excluding all deferred tax effects until the annual audit is performed.

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