Question 3: McCombie, K (2023), Amended past question

For the year ended 30 June 2023, Lulu Ltd reported a profit before tax of $10,000. Included in the profit were the following income and expense items:

Interest revenue $50,000 Rent revenue $25,000 Bad debts expense $10,000 Depreciation expense plant $21,000 Long service leave expense $20,000

The draft Statements of Financial Position of Lulu Ltd at 30 June 2023 and 30 June 2022 included the following assets and liabilities:

2023 2022 $ $ Accounts receivable 70,000 50,000 Allowance for doubtful debts (10,000) (5,000) Interest receivable 20,000 25,000 Plant 210,000 210,000 Accumulated depreciation plant (63,000) (42,000) Rent revenue received in advance 8,000 4,000 Provision for long service leave 30,000 40,000 Additional information: For accounting purposes plant is depreciated using the straight line method over 10 years. For tax purposes plant is depreciated using the straight line method over 3 years. The company tax rate is 30%. Required: Prepare the current tax worksheet and the journal entry to recognise current tax at 30 June 2023.