Question 4: Income tax Summarised Statement of Profit/Loss before Tax and balances extracted from the Statement of Financial Position for ABC Limited for the period ending 31 December 2019 are given below. Statement of Profit or Loss Note $'000 31 December 2019 Sales Revenue 1,245 Less Expenses Salary expense Distribution expense Provision for annual leave Bad and Doubtful debts expense Depreciation expense Entertainment expense (452) Profit before tax Balance Sheet Extract 31 December 2019 Assets Trade receivables (net) Equipment (net) Liabilities Annual leave Provision Additional information Note 1 The opening balance of the annual leave provision as at 1 January 2019 was $17,000. Note 2 As at 31 December 2019, an allowance for doubtful debts is $25,000. As at 1 January 2019, the balance was $9,000. Note 3 50% of the Entertainment expense is deductible for tax purposes Note 4 The equipment was purchased on 1 January 2017 at a cost of $300,000. The asset has a useful life of five years and no residual value. Depreciation rate for equipment for tax purposes is four years. Note 5 As at 1 January 2019, total (gross) deductible temporary differences were $35,000 and total (gross) taxable temporary differences were $16,000 Note 6 The tax rate is 28%. Required Prepare the current tax worksheet as at 31 December 2019 (Show necessary workings). 2. Prepare the deferred tax worksheet and any necessary journal entries to adjust the deferred tax accounts (Show necessary workings) Question 4: Income tax Summarised Statement of Profit/Loss before Tax and balances extracted from the Statement of Financial Position for ABC Limited for the period ending 31 December 2019 are given below. Statement of Profit or Loss Note $'000 31 December 2019 Sales Revenue 1,245 Less Expenses Salary expense Distribution expense Provision for annual leave Bad and Doubtful debts expense Depreciation expense Entertainment expense (452) Profit before tax Balance Sheet Extract 31 December 2019 Assets Trade receivables (net) Equipment (net) Liabilities Annual leave Provision Additional information Note 1 The opening balance of the annual leave provision as at 1 January 2019 was $17,000. Note 2 As at 31 December 2019, an allowance for doubtful debts is $25,000. As at 1 January 2019, the balance was $9,000. Note 3 50% of the Entertainment expense is deductible for tax purposes Note 4 The equipment was purchased on 1 January 2017 at a cost of $300,000. The asset has a useful life of five years and no residual value. Depreciation rate for equipment for tax purposes is four years. Note 5 As at 1 January 2019, total (gross) deductible temporary differences were $35,000 and total (gross) taxable temporary differences were $16,000 Note 6 The tax rate is 28%. Required Prepare the current tax worksheet as at 31 December 2019 (Show necessary workings). 2. Prepare the deferred tax worksheet and any necessary journal entries to adjust the deferred tax accounts (Show necessary workings)