Red Hill Ltd had a tax loss of $50,200 for the year ended 30 June 2020. The financial statements of Red Hill Ltd for the year ended 30 June 2021 showed a profit before tax of $100,000, including the following items of income and expense:

Impairment of goodwill	12,000
Depreciation expense – equipment	60,000
Bad debts expense	6,400
Long service leave expense	16,000
Insurance expense	2,000

Additional Information for 30 June 2021:

• The tax deduction for equipment depreciation was $80,000.
• The balance in the Allowance for Doubtful Debts account at 30 June 2020 was $15,000, and at 30 June 2021 the balance in the account was $10,000.
• Long service leave costs of $24,000 had been paid during the current year.
• The balance of the Prepaid Insurance account at 30 June 2020 was $4,800, and the balance in the account at 30 June 2021 was $3,600.
• The tax rate is 30%

Prepare the complete current tax worksheet for the year ended 30 June 2021 and the journal entries to record current tax (and/or deferred tax). Narrations are not required.

Answer rating: 100% (QA)

Computation of current tax for the year ended 30 June 2021 Profit before tax 100000 Add Impairment o... View the full answer