2 Newcastle Ltd determined an accounting profit before tax of $256,000 for the year ended 30 June 2020. Included in this profit are the following items: Royalty revenue (non-assessable) Annual leave expense Depreciation expense-buildings Depreciation expense-plant Doubtful debts expense Entertainment expense 6.000 (45 000) (8.000) (22 500) (3 500) (2 000) (7000) Insurance expense An extract of the company's draft balance sheet at 30 June 2020 showed the following: Assets Cash $ 2500 Accounts receivable $ 21 500 less allowance for doubtful debts (4.000) 17 500 Inventory 32 000 Prepaid insurance 4 500 Plant 150 000 less Accumulated depreciation (67 500) 82 500 Buildings 170 000 less Accumulated depreciation (60 000) 110 000 Cash Accounts receivable less allowance for doubtful debts $ 2500 $ 21 500 (4 000) 17 500 Inventory 32 000 Prepaid insurance 4 500 Plant 150 000 less Accumulated depreciation (67 500) 82.500 Buildings 170 000 less Accumulated depreciation (60 000) 110 000 Land 75 000 Deferred tax assets (net) as at 1 July 2013 Liabilities Accounts payable Provision for annual leave Loan 4 500 328 500 25 000 10 000 140 000 $175.000 Additional information a) Quarterly income tax instalments paid during the year were: 28 October 2019 28 January 2020 28 April 2020 Note: Final instalment due on 28 July 2020 b) The following items are exempt from tax rules: a. Royalties are non-assessable b. Entertainment expenses are non-deductible $18,000 18,000 17,000 c) The tax depreciation rate for plant (purchased 3 years ago for $150,000) is 20%. d) Tax depreciation on buildings is equal to accounting depreciation on buildings. e) During the year, the following cash amounts were paid: Annual leave Insurance $52,000 6,500 f) Bad debts of $2,500 were written off against the allowance for doubtful debts during the year. g) Newcastle Ltd has tax losses amounting to $15,000 carried forward from prior years. These can be offset against current year's taxable profit. h) Land was incrementally revalued by $10 000 during the current period. i) The deferred tax balances at 30 June 2019 were: a. Deferred tax assets b. Deferred tax liabilities $10,500 $6,000 j) The company tax rate is 30%. Required I a. Determine the balance of any current and deferred tax assets and liabilities for Newcastle Ltd at 30 June 2020. b. Prepare the journal entries for the year ended 30 June 2020. c. Calculate the income tax expense for the year ended 30 June 2020