Homework Answers
1. Computation of Taxable Income :
| Particulars | Amount ($) |
| Net Profit before Tax | 21000 |
| Add : Depreciation as per P&L | 3000 |
| Less : Depreciation as per Tax | -4000 |
| Taxable Income | 20000 |
2. Amount of Tax Payable :
Tax=Taxable Income*Tax Rate
=20,000*30%
=$6000
3. Journal Entry :
Income Tax Expense Dr. $6000
To Profit & Loss A/C $6000
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Question 1
Question 2
Question 3
3
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Calculating tax base-assets (7 points) Calculate the tax base at the end of the tax year (30June) for various assets in the following unrelated circumstances. Show your calculations in the worksheet provided at the end of the question. State if the item is a deferred tax asset (DTA) or a deferred tax liability (DTL). a) Accounts receivable has a balance of $41000 There is an allowance for doubtful debts totalling $7000. b)...
The following information was extracted from the records of
Bulb Ltd as at 30 June 2013:
The depreciation rates for accounting and taxation are 15% and
25% respectively. Deposits 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 Bulb Ltd as at 30...
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