Question: Data for Jesse Ltd for the year ended 30 June 2022 are as follows: Accounting profit before tax:$30,000Depreciation plant20,000Depreciation equipment1,000Entertainment expense10,000Long service leave

Data for Jesse Ltd for the year ended 30 June 2022 are as follows: Accounting profit before tax:$30,000Depreciation – plant20,000Depreciation – equipment1,000Entertainment expense10,000Long service leave expense4,000Plant cost (bought 2 years ago)200,000Equipment cost (purchased 6 years ago)10,000Additional information: The ATO allows straight line depreciation rate of 25% for both plant and equipment. Jesse Ltd applies a straight line rate of 10% in its accounting records. Long service leave is deductible when paid. No employee has been paid long service leave in the current year. Entertainment expense are not tax deductible. The company tax rate is 30%.

Calculate the taxable income of Jesse Ltd for 30 June 2022 and prepare the journal entry for the current year income tax expense.

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