Forrest Ltds statement of financial position includes a Provision for Warranty Expense

amounting to $100 000 as at 30 June 2020. The provision was created in the current financial

year (ending 30 June 2020) and no amounts have been paid.

Required (to submit as a SINGLE file attachment):

Assume a company tax rate of 30%,

(a) calculate the tax base of the asset or liability showing all workings and formula applied,

(b) determine whether the temporary difference leads to a deferred tax asset or liability as well as explain your rationale, and

(c) prepare the appropriate journal entry to account for the temporary difference between carrying amount and tax base.