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Question 5 [ 2 0 ] SMB is a small local corporate entity that operates a transport business in Country X . On 1 April
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SMB is a small local corporate entity that operates a transport business in Country X
On April SMB acquired an additional vehicle that qualified for tax depreciation allowances. The vehicle cost R and has an expected useful life of years with a residual value of R
The appropriate accounting entries for this vehicle have been included in the accounts.
Extracts from SMBs financial statements:
Page of
SMB Statement of financial position as at March
R
Noncurrent liability
Deferred tax provision
Current liability
Tax payable
SMBs Statement of profit or loss extract for year ended March
R
Revenue
Expenses
Profit before tax
SMB Statement of cash flows for year ended March
R
Tax paid
Revenue includes a nontaxable government grant of R
Expenses include:
Depreciation charges of R for SMBs other noncurrent assets. These assets qualified for tax depreciation allowances of R
Entertaining costs of R
Required:
Calculate SMBs corporate income tax due for the year ended March
Total for subquestion marks
Required:
i Calculate the deferred tax balance that will appear in SMBs statement of financial position under noncurrent liabilities at March
ii Calculate the amount of income taxes charged to SMBs statement of profit or loss for the year ended March
Total for subquestion marks
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