Stucco Ltd, a tile manufacturer, reported a profit before tax of R5 000 000 for the year ended 31 December 2022.

Included in the profit before tax are the following:

	R
Dividends received from SA companies	500 000
Fines (not deductible for tax purposes)	(250 000)
Donations (not deductible for tax purposes)	(200 000)

The deferred tax liability in the Statement of Financial Position at 31 December 2021 and 31 December 2022 is R168 000 and R126 000, respectively.

Temporary differences comprise the following:

• On 1 January 2019, the company acquired plant at a cost of R1 000 000. It is the company's policy to depreciate plant over 5 years using the straight-line method. Capital allowances allowed by SARS on the plant are on the 40:20:20:20 basis.
• The following balances at 31 December 2022:

	R
Prepaid expenses	800 000
Provision for warranty costs	750 000

• SARS grants deductions for expenses when it is paid.

Assume that sufficient future taxable profits will be available against which deductible temporary differences can be utilised.

The company's tax rate is 28%.

Source: Daniels, J.C. 2023.

1. Compute the deferred tax expense that should be recognised in the statement of profit or loss and other comprehensive income for the year ended 31 December 2022. Indicate whether it is a debit or credit entry. (2 Marks)

2. Compute the current tax for the year ended 31 December 2022. (8 Marks)

3. Prepare the Income tax expense note for the year ended 31 December 2022. (10 Marks)