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Bondi Ltd's accounting profit before tax for the year ended 30 June 2024 was $150 000. Included in the profit were the following income and
Bondi Ltd's accounting profit before tax for the year ended 30 June 2024 was $150 000. Included in the profit were the following income and expenses: Royalty revenue $20 000 Bad debts expense 20 000 Insurance expense 20 000 Accrued expenses 180 000 Warranty expense 45 000 Depreciation - equipment 40 000 Depreciation - building 20 000 At 30 June 2023 and 30 June 2024, the company's draft (extract) statements of financial position showed the following balances. 2023 2024 Assets Cash Inventories Accounts receivable Allowance for doubtful debts Prepaid insurance Equipment Accumulated depreciation - equipment Buildings Accumulated depreciation - buildings Deferred tax asset $ 40 000$ 50 000 150 000 160 000 300 000 420 000 (15 000) (21 500) 20 000 15 000 200 000 200 000 (80 000) (120 000) 400 000 400 000 (140 000) (160 000) 45 000 ? 2 Liabilities Accounts payable Accrued expenses Warranty payable Current tax liability Deferred tax liability 255 000 270 000 120 000 90 000 70 000 50 000 9 000 ? 12 000 ? Additional information The company tax rate is assumed to be 30%. The equipment is depreciated on a straight-line basis over 5 years for accounting purposes and over 4 years for taxation purposes. The equipment is not expected to have any residual value. . The buildings are depreciated on a straight-line basis over 20 years for accounting purposes and are not expected to have any residual value. Depreciation of buildings is not allowed to be claimed as a deduction for tax purposes. In the previous year Bondi Ltd recognised a tax loss of $15 000. Required 1. Prepare the current tax worksheet and the journal entry to recognise current tax at 30 June 2024. 2. Prepare the deferred tax worksheet and journal entries to adjust deferred tax accounts
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