On the 1st April 2021 the company invested $850,000 in a term deposit which accrued interest at 5.6% per annum. Interest is paid half-yearly on 30th September and 31st March. At the start of the financial year the company held no other interest bearing investments. 

Required: 

you have been asked to complete the preparation of the journal entry adjustments for any temporary tax differences and to explain in each of the situations given above the reasons for the adjustments, why the accounts have been chosen and the timing of the differences and any future reversals?

Answer rating: 100% (QA)

On the 1st April 2021 No deferred tax is generated in the ... View the full answer