Phoenix Rising Ltd began operations on 1^st July 2017 by purchasing an existing business for $350,000. The fair values of the assets of the purchased business were as follows:

Asset	Fair value $
Vehicles	44,000
Equipment	190,000
Computers	96,000

The excess of the purchase consideration over the fair value of the assets acquired was recorded as goodwill.

The depreciation schedules for the financial reports and the company income tax return respectively are listed below. The company income tax rate is 30%.

Depreciation Schedules	Vehicles	Equipment	Computers
Depreciation rate:
Accounting	25%	25%	25%
Tax	40%	30%	50%
Method:
Accounting	Straight-line	Straight-line	Straight-line
Tax	Reducing Balance	Reducing Balance	Reducing Balance
Residual:	$4,000	$10,000	$6,000

During the first year of operations, the company recognised the following transactions which are treated differently for tax and accounting purposes:

Insurance of $19,000 was paid for during the year. Of this amount, $13,200 is prepaid for next year.

Rent is paid for in arrears. $13000 is owing at the end of the current year and $4,600 has been paid in cash.

Employee Entitlements (Annual, Sick and Long Service Leave) totalling $8,000 were provided for during the year. No payments were made.

Allowance for Impairment for Accounts Receivable was $2,000.

Items in the income statement which were treated the same for accounting and tax purposes were:

Sales $450,000

Cost of Goods Sold $228,000

Salaries and Wages $42,000

Other expenses $9,600

Other items in the statement of financial position as at 30^th June 2018 are:

Year end balances	$
Inventory on hand	156,000
Accounts receivable	43,000
Goodwill (net)	17,500
Accounts payable	21,000
Cash at Bank	19,000

Additional information:

No debts were written off as bad during the year.

For year ended 30^th June 2018 the profit before income tax of Phoenix Rising Ltd was $57,000.

Required:

Prepare a schedule that shows the calculation of taxable income and current tax liability for Phoenix Rising Ltd for the year ending 30^th June 2018. (2.5 marks)

Prepare a worksheet that shows the calculation of deferred tax liabilities and deferred tax assets for Phoenix Rising Ltd as at 30^th June 2018. (5 marks)

Provide journal entries to record the current tax liability, deferred tax assets (if any) and deferred tax liabilities (if any). Offset is optional. Exclude journal narrations. (2.5 marks)