QUESTION 2 [37] The following information relates to Bob Limited. The accountant had correctly calculated profit before tax of R885 000 after taking into account the following:

- Depreciation on office equipment of R110 000 in 2018. The Receiver of Revenue allowed the deduction of R80 000 wear and tear on this equipment in 2018.

- Rent income received in advance (taxable when received): 31 December 2017 R6 500 31 December 2018 R7 500

- Insurance expense prepaid: 31 December 2017 R3 000 31 December 2018 R6 000

- A provision for leave pay of R50 000 was recorded on 31 December 2018. The tax authority only allows this to be deducted when paid.

- A profit on sale of machinery of R150 000. The machine was acquired on 01 January 2016 at a cost of R600 000 and sold on 31 December 2018. Depreciation is calculated at 25% p.a. straight line to a nil residual value. Wear and tear allowances of 20% p.a. straight line are granted.

- A non deductible traffic fine R1 000.

- Dividends received R60 000.

The inclusion rate for capital gains made by companies is 33.3%. The applicable tax rate is 30% on taxable profits. There were no other temporary differences in the year.

Required: 2.1 Calculate the current tax and show the related journal entries. [25]

2.2 Show the disclosure of taxation in the statement of comprehensive income and the taxation expense note for the year ended 31 December 2018 in accordance with International Financial Reporting Standards. [12]