A company commenced business on 1 July 2022. On 30 June 2023, a draft statement of financial position disclosed the following information: accounts receivable $25,000, allowance for doubtful debts $3,000, plant $200,000, accumulated depreciation plant $20,000, provision for annual leave $8,000, and revenue in advance $12,000.

The plant was acquired on 1 July 2022. Depreciation for accounting purposes was 10% (straight-line method), while 20% (straight-line) was used for tax purposes. The company tax rate is 30%.

In a deferred tax worksheet, the ending balances for the deferred tax accounts are:

Select one:

a.

Deferred Tax Liability $20,000; Deferred Tax Asset $23,000

b.

Deferred Tax Liability $6,900; Deferred Tax Asset $6,000

c.

Deferred Tax Liability $23,000; Deferred Tax Asset $20,000

d.

Deferred Tax Liability $6,000; Deferred Tax Asset $6,900