The profit before tax, reported in the statement of comprehensive income of Sam Ltd for the...

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The profit before tax, reported in the statement of comprehensive income of Sam Ltd for the year ended 2023 amounted to: Subscription revenue Government award income Doubtful debts expense Depreciation (Equipment) Depreciation (Buildings) Maintenance expense Employee benefits expense Rent expense Entertainment expense 59,00,000 1,84,000 3,31,000 38,000 3,59,400 1,10,625 1,85,000 1,10,000 55,000 92,100 The draft statements of financial position of the company at 30 June 2023 and 2022 showed the following assets and 2023 ($) 2022 ($) Assets Cash 3,87,000 4,24,000 Inventory 8,29,000 7,55,000 Accounts receivable 23,96,000 22,86,000 Allowance for doubtful debts -1,91,000 -1,77,000 Prepaid rent 1,03,000 95,000 Equipment 23,98,000 23,96,000 Accumulated depreciation - Equipment -17,97,000 -14,37,600 Buildings 14,75,000 14,75,000 Accumulated depreciation - Buildings -11,08,250 -9,95,825 Land 9,21,000 9,21,000 Goodwill (net) 3,68,000 3,68,000 Deferred tax asset ? 18,840 Liabilities Accounts payable Provision for maintenance Provision for employee benefits Subscription received in advance Deferred tax liability Additional Information: Subscription revenue is tax assessable when it is received in cash Government award income is not tax assessable 14,01,000 12,53,000 2,95,000 2,21,000 2,02,000 1,47,000 1,29,000 92,000 ? 0 Doubtful debts are tax deductible when the company actually incurs bad debts/write off For accounting purpose, the equipment is depreciated using the annual straight line method at a rate For tax purpose, however, the equipment is depreciated using the annual straight line method at a rate Depreciation of buildings is not allowed as tax deductions and goodwill is not tax assessable Employee benefits are tax deductible when they are paid in cash to the employees Rent expense and maintenance expense are tax deductible when paid in cash Entertainment expense is not allowed as tax deduction 15% 20% Assume a tax rate for the financial years ending 30 June 2022 and 2023 to be: Required: 30% Calculate the taxable income/tax loss and the current tax liability (if any) for the financial year ended 30 June 2023. Prepare a journal entry to recognise the current tax liability/tax loss. Calculate deferred tax asset and deferred tax liability balances as at 30 June 2023. Prepare the deferred tax journal entries for the year ended 30 June 2023. Note that you are NOT required to prepare journals to offset the deferred tax asset and deferred tax liability balances. Show your calculation using deferred tax worksheets by creating separate columns for carrying amount, tax base, taxable temporary differences and deductible temporary differences. Assume that by 1 December 2023 there was a change in tax rate to: 27.50% With reference to AASB112 Income Taxes, discuss the accounting treatment of the deferred tax asset and deferred tax balances as at 1 December 2023 following a lower tax threshold for the 2023-2024 financial year. Prepare the journal entries to record the effect of change in tax rate. The profit before tax, reported in the statement of comprehensive income of Sam Ltd for the year ended 2023 amounted to: Subscription revenue Government award income Doubtful debts expense Depreciation (Equipment) Depreciation (Buildings) Maintenance expense Employee benefits expense Rent expense Entertainment expense 59,00,000 1,84,000 3,31,000 38,000 3,59,400 1,10,625 1,85,000 1,10,000 55,000 92,100 The draft statements of financial position of the company at 30 June 2023 and 2022 showed the following assets and 2023 ($) 2022 ($) Assets Cash 3,87,000 4,24,000 Inventory 8,29,000 7,55,000 Accounts receivable 23,96,000 22,86,000 Allowance for doubtful debts -1,91,000 -1,77,000 Prepaid rent 1,03,000 95,000 Equipment 23,98,000 23,96,000 Accumulated depreciation - Equipment -17,97,000 -14,37,600 Buildings 14,75,000 14,75,000 Accumulated depreciation - Buildings -11,08,250 -9,95,825 Land 9,21,000 9,21,000 Goodwill (net) 3,68,000 3,68,000 Deferred tax asset ? 18,840 Liabilities Accounts payable Provision for maintenance Provision for employee benefits Subscription received in advance Deferred tax liability Additional Information: Subscription revenue is tax assessable when it is received in cash Government award income is not tax assessable 14,01,000 12,53,000 2,95,000 2,21,000 2,02,000 1,47,000 1,29,000 92,000 ? 0 Doubtful debts are tax deductible when the company actually incurs bad debts/write off For accounting purpose, the equipment is depreciated using the annual straight line method at a rate For tax purpose, however, the equipment is depreciated using the annual straight line method at a rate Depreciation of buildings is not allowed as tax deductions and goodwill is not tax assessable Employee benefits are tax deductible when they are paid in cash to the employees Rent expense and maintenance expense are tax deductible when paid in cash Entertainment expense is not allowed as tax deduction 15% 20% Assume a tax rate for the financial years ending 30 June 2022 and 2023 to be: Required: 30% Calculate the taxable income/tax loss and the current tax liability (if any) for the financial year ended 30 June 2023. Prepare a journal entry to recognise the current tax liability/tax loss. Calculate deferred tax asset and deferred tax liability balances as at 30 June 2023. Prepare the deferred tax journal entries for the year ended 30 June 2023. Note that you are NOT required to prepare journals to offset the deferred tax asset and deferred tax liability balances. Show your calculation using deferred tax worksheets by creating separate columns for carrying amount, tax base, taxable temporary differences and deductible temporary differences. Assume that by 1 December 2023 there was a change in tax rate to: 27.50% With reference to AASB112 Income Taxes, discuss the accounting treatment of the deferred tax asset and deferred tax balances as at 1 December 2023 following a lower tax threshold for the 2023-2024 financial year. Prepare the journal entries to record the effect of change in tax rate.

Answer rating: 100% (QA)

To calculate the taxable incometax loss and the current tax liability for the financial year ended 30 June 2023 we need to consider the given information and apply the applicable tax rules Lets calcul... View the full answer