vision for warranty Deposits received in advance Carrying amount $150 000
The following information was extracted from the records of Jackson Ltd as at 30 June 2020.
Asset (liability)
Motor vehicles
Provision for warranty
Deposits received in advance
Carrying amount
$150 000
165 000
(12 000)
(15 000)
Tax base
$175 000
125 000
0
0
The
are taxable when received, and warranty costs are deductible when paid. An allowance for doubtful
debts of $25 000 has been raised against accounts receivable for accounting purposes, but such debts
are deductible only when written off as uncollectable.
Required
1. Calculate the temporary differences for Jackson Ltd as at 30 June 2020. Justify your
classification of each difference as either a deductible temporary difference or a taxable
temporary difference.
2. Prepare a
ended 30 June 2020 assuming no deferred items had been raised in prior years.
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