Part C The following deferred tax working papers of Blue Cheese Limited have been partially prepared at 28 February 20X2: Carrying amount Tax base Temporary difference Deferred tax Plant and equipment Balance-28/02/20X1 640 000 600 000 ? ? ? ? ? ? ? ? 727 ? ? ? Balance-28/02/20X2 Interest income receivable: Balance-28/02/20X1 ? 0 ? Balance-28/02/20X2 20 000 227 ? ? ? ? ? 722 ? ? ? All of the plant and equipment was purchased on 1 March 20X0 at a cost of 800 000 and there have been no purchases or sales of plant and equipment since that date. Plant and equipment is depreciated at 20% per annum on the diminishing balance method. The company tax accountant has confirmed the income tax treatment of the above items for the year ended 28 February 20X2 is as follows: Statement of financial position item Plant and equipment Interest income receivable Income tax treatment 200 000 tax allowance Taxable in year interest is earned The profit before tax is 1 000 000 and there are no other differences between accounting profit and taxable profit other than those evident from the information given. The income tax rate is 20% on taxable profits. The HMRC account had a credit balance of 150 000 on 28 February 20X1, which was paid in full during the year ended 28 February 20X2. Required: a) Complete the deferred tax working paper. b) Show the ledger account for tax expense. (4 marks) (3 marks) c) Explain with reasons, whether the temporary differerice at 28 February 20X2 is taxable or deductible and whether the resultant deferred tax is an asset or liability (3 marks) (Part C: 10 marks) (Total: 35 marks)