Determine the taxable income and income tax payable for the year to 30 June 2020. (2.5 Marks) Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. (3 marks) Prepare the necessary journal entries to account for income tax assuming recognition criteria are satisfied. (2.5 marks)
Determine the taxable income and income tax payable for the year to 30 June 2020. (2.5 Marks) Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. (3 marks) Prepare the necessary journal entries to account for income tax assuming recognition criteria are satisfied. (2.5 marks)
Chapter17: Corporations: Introduction And Operating Rules
Section: Chapter Questions
Problem 47P
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Question
At 30 June 2019, Beta Ltd had the following deferred
Deferred tax liability $18,000
Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included the following items:
|
$7,000 |
Doubtful debts expense |
3,000 |
Long-service leave expense |
4,000 |
For
Depreciation rates for taxation purposes are higher than for accounting purposes. A corporate tax rate of 30% applies.
Required:
- Determine the taxable income and income tax payable for the year to 30 June 2020. (2.5 Marks)
- Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave. (3 marks)
- Prepare the necessary
journal entries to account for income tax assuming recognition criteria are satisfied. (2.5 marks) - What are the balances of the deferred tax liability and deferred tax asset at 30 June 2020? (2 marks)
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