Basin Ltds statement of profit or loss for the year ended 30 June 2021 and extracts from its

statements of financial position as at 30 June 2021 and 30 June 2020 are shown below. The

statements for the current year are yet to be finalised by accounting for income tax.

Basin Ltd

Statement of Profit or Loss

for the year ending 30 June 2021

Income

Service revenue $ 900 000

Rent revenue 50 000

Insurance claim for loss of profits 41 200 991 200

Less: Expenses

Employee expenses 660 000

Insurance expense 50 000

Accounting fees 5 500

Bad and doubtful debts 19 500

Cleaning and maintenance 3 250

Depreciation of equipment 5 500

Entertainment expenses 4 000

Interest on borrowings 75 000

Legal fees 3 800

Motor vehicle expenses 6 000

Other 3 750

Restructuring costs 23 000 859 300

Profit before tax $ 131 900

2

Basin Ltd

Statement of Financial Position (Extract)

as at 30 June

2021 2020

Assets

Cash at bank $ 900 100 $ 800 100

Trade debtors 240 550 200 000

Allowance for doubtful debts (38 000) (20 000)

Prepaid insurance 10 950 5 000

Land at fair value 450 000 300 000

Equipment at cost 58 000 58 000

Accumulated depreciation (24 500) (19 000)

Other debtors 142 400

Deferred tax asset ? 18 000

Liabilities

Trade creditors 239 000 245 000

Borrowings 543 800 438 500

Unearned rent revenue 50 000

Provision for employee benefits 49 500 40 000

Provision for restructuring 23 000

Other creditors 10 000

Current tax liability 13 300

Deferred tax liability ? 32 700

Additional information

(a)The original cost of the land is $200 000.

(b)The tax written down value of equipment at 30 June 2021 is $28 000 (2020: $35 000). During

the 2021 year, there were no additions or disposals of equipment.

(c)Legal fees of $3800 are capital in nature and non-deductible for tax purposes.

(d)Other creditors at 30 June 2021 include an accrual for accounting fees of $4500 for work not

yet performed (2020: $Nil). For tax purposes, the accounting fees are deductible only if work

has been performed.

(e) For tax purposes, restructuring costs are deductible only when paid.

(f) Other debtors at 30 June 2021 include $41 200 relating to an insurance claim that is inprocess. Insurance income is only assessable for tax purposes after the insurance proceeds

have been received.

(g)The corporate tax rate is 30%.

Required:

i. Prepare the current tax worksheet for the year ending 30 June 2021 and the current tax entries

for the year.

ii. Prepare the deferred tax worksheet at 30 June 2021 and the deferred tax entries for the year