Case study 5: Part 1: There had been a group discussion on various aspects related to accounting amongst few graduates. Each graduate had come up with an opinion about the topics that are been discussed below. You are required to review each of the discussion and validate their opinion with required explanation. Also you need to provide the correct opinion in case you disagree with all the opinions. (2 marks - Min 100 words) Discussion: Deferred taxes are recorded in financial statements and it is likely that every company that has to pay tax will also have deferred taxes in their financial statements: Graduate 1 stated that deferred taxes are recorded in financial statements but it is not likely that every company that pays tax will also have deferred taxes. It will only occur if they have permanent timing differences. Graduate 2 mentioned that deferred taxes are recorded in Income statement as income or expenses and it is always a company that pays tax also has deferred taxes Graduate 3 stated that deferred taxes are recorded in statement of financial position as current assets or current liabilities Graduate 4 was unable to provide any opinion on such statement. Part 2: You are a junior accountant who is involved in tax related matters of the company. The senior accountant has provided with a scenario related to deferred taxes which you need to deal with. The tax rate is 10%. The Company has purchased a machinery in the year 2019 for RO 1,500,000. The machinery is estimated to have 12 years of useful life. It was decided that for the book purposes the depreciation rate to be used should be 8.333% straight line method. But for the tax purposes the depreciation rate to be used is 11.111% on cost. The company wants to know the deferred tax amounts that will be generated due to such machinery depreciation for the first 10 years of the asset life. You are required to provide a detailed calculation for the above situation along with necessary comments showing deferred tax movement over the first 10 years of the asset life