Question
Apple Ltd purchased a depreciable asset for $360,000 on 1 July 2004. For accounting purposes, it is estimated to have a useful life of 12
Apple Ltd purchased a depreciable asset for $360,000 on 1 July 2004. For accounting purposes, it is estimated to have a useful life of 12 years with no residual value. For taxation purposes, the useful life is 10 years with no residual value. The asset is depreciated on the straight-line basis for both accounting and tax purposes. The tax rate is 30%.
What is the adjustment required in the deferred tax liability account for the year ended 30 June 2014 and 30 June 2015 respectively?
a) $6,000; ($30,000) b) $1,800; ($9,000) c) $1,800; $9,000 d) $60,000; $30,000 e) $18,000; $9,000
and why?
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