The statement of financial position of Sallyi Ltd at 30 June 2020 showed the following assets and
Question:
The statement of financial position of Sallyi Ltd at 30 June 2020 showed the following assets and liabilities.
Assets | 2020 ($) | 2019($) |
Cash | 80 000 | 85 000 |
Inventories | 170 000 | 155 000 |
Accounts Receivables | 520 000 | 480 000 |
Allowance for Doubtful Debts | (60 000) | (40 000) |
Plant | 500 000 | 500 000 |
Accumulated depreciation – plant | (260 000) | (210 000) |
Deferred Tax Asset | ? | 35 500 |
Liabilities | ||
Accounts payable | 290 000 | 260 000 |
Provision for long service leave | 48 500 | 45 000 |
Rent Received in advance | 22 500 | 20 000 |
Deferred Tax Liability | ? | 0 |
Additional information
- Accumulated depreciation of plant for tax purposes was $330 000 at 30 June 2019, and depreciation for tax purposes for the year ended 30 June 2020 amounted to $80 000.
- The tax rate is 30%.
Required (show all workings):
Prepare Sallyi’s deferred tax worksheet/workings at 30 June 2020 (showing only relevant assets and liabilities), and prepare the deferred tax journal entry required on 30 June 2020. Narration is not required.
Financial Accounting and Reporting
ISBN: 978-0273744443
14th Edition
Authors: Barry Elliott, Jamie Elliott