Question 4 Neo Ltd commenced business on 1 July 2017 and reported a 2018 net profit before tax of $13,050. Profit was determined are charging the following items: Entertainment expenses 10,000 Doubtful debts 14,000 Depreciation of machinery 11,000 Long service leave (LSL) 8,000 The 30 June 2018 accounting and taxation records disclosed the following: Carrying Tax Base FID DTD Amount Assets Plant & 46,000 46,000 Machinery Accum (11,000) (13,000) 2,000 Depreciation 35,000 33,000 Cash at Bank 50,000 50,000 Inventory 10,000 10,000 Accounts 32,000 38,000 6,000 Receivable (net) Total Assets 127,000 131,000 Liabilities Accounts 16,000 16,000 Payable Provision for 5,000 NIL 5,000 LSL Total Liabilities 21,000 16,000 Net Assets 106,000 115,000 2,000 11,000 Additional Information 1. An amount of $8,000 for bad debt written off has been charged against the allowance for doubtful debts. This can now be claimed as a tax deduction. 2. An amount of $3,000 in LSL was paid during the year and can now be claimed for tax 3. Income tax rate is 30%. Prepare the following: a) Prepare a statement of taxable income for the year ended 30 June 2018 b) Calculate deductible temporary differences in the above table c) Calculate taxable temporary differences in the above table. d) Prepare the journal entries for income tax expense in accordance with AASB112