At 30 June 2019, Beta Ltd had the following deferred tax balances:Deferred tax liability $18,000Deferred tax asset 15,000Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included the following items:Depreciation expense – plant $7,000Doubtful debts expense 3,000Long-service leave expense 4,000For taxation purposes the following amounts are allowable deductions for the year to 30 June 2020:Tax depreciation – plant $8,000Bad debts written off 2,000Depreciation rates for taxation purposes are higher than for accounting purposes. A corporate tax rate of 30% applies. Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave
At 30 June 2019, Beta Ltd had the following
Beta Ltd recorded a profit before tax of $80,000 for the year to 30 June 2020, which included the following items:
Doubtful debts expense 3,000
Long-service leave expense 4,000
For
Tax depreciation – plant $8,000
Depreciation rates for taxation purposes are higher than for accounting purposes. A corporate tax rate of 30% applies.
Determine by what amount the balances of the deferred liability and deferred tax asset will increase or decrease for the year to 30 June 2020 because of depreciation, doubtful debts and long-service leave
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