+ Q&A Library David Ltd commences operations on 1 July Question David Ltd commences operations on 1 July 2020 On the same date, it purchases a machine at a cost of $1000 000 The machine is expected to have a useful life of 4 years, with benefits being uniform throughout its life. It will have no residual value at the end of 4 years Hence, for accounting purposes the depreciation expense would be $250 000 per year For taxation purposes, the ATO allows the company to depreciate the asset over three years--that is, $200 000 per year The profit before tax of the company for each of the next four years (years ending 30 June) is $600 000, 5700 000,$800 000 and $900 000 respectively The tax rate is 30 per cent Required: 1. Calculate the taxable profit on 30 June 2021, 30 June 2022, 30 June 2023. 2. Record the necessary journal entries. man