Corporate accounting

Question 1 : Calculation of current and deferred tax The following data applies to the two unrelated companies Lloyd Ltd and Cole Ltd: Lloyd Ltd Cole Ltd Profit before tax for the year to 30 June 2017 $1 300 000 $136 000 Taxable income for the year to 30 June 2017 340 000 150 000 Deferred tax liability 1 July 2016 90 000 Deferred tax asset 1 July 2016 15 000 Taxable temporary differences at 30 June 2017 960 000 306 000 Deductible temporary differences at 30 June 2017 70 000 All taxable and deductible temporary differences relate to the profit or loss. Assume a corporate tax rate of 30%. Required A. For each company, prepare the journal entries to record the current and deferred tax for 30 June 2017