Hippo & Cat Limited (H&C) is a retailer of fashion in the region. It grows quickly in the year. Hippo, the CEO, is concerned about H&C's tax position and asks Cat, the CFO, to estimate the tax liability for review.

Below are the extracts of the final (draft) statement of financial position of H&C as at 31 December 2019 (2020).

20196 20204 Non-current assets Property, plant and $400,000( $400,000 equipment at cost accumulated depreciation -$80,000( -$120,000( Deferred tax assets $8,000( Current asset Prepaid rent $20,000( Non-current liabilities Deferred tax liabilities $4,000( Provision for employee $40,000( $55,000( benefits Current liabilities Accrued revenue $10,000(