Question Three (13 marks) Financial statements Macfarlane Ltd shows interest receivable with a carrying amount of $35 000. The related revenue will be taxed by the Australian Tax Office when the amounts are actually received. Macfarlane Ltd has also a piece of machinery with a carrying amount of $900 000 and a tax base of $850 000 if the asset were sold immediately (which reflects the effects of indexation for capital gains tax purposes). Assume that the tax rate is 30%. REQUIRED a) What is the amount of the temporary difference? (5 marks) b) Does the temporary difference give rise to a deferred tax asset or a deferred tax liability and what is the amount of the deferred tax asset/liability? (5 marks) c) Assume that the machinery (as explained in this question) has a tax base of $800, 000 and its economic benefits were to be recovered through use within Macfarlane Ltd. Determine the balance of the deferred tax liability or deferred tax asset, given the scenario that the asset will be retained for use within Macfarlane Ltd. (3 marks) REQUIRED a. Prepare all journal entries necessary to account for the issue of the shares. In your answer narratives for journal entries are not necessary but you must include the date of the journal entry as included in the question. (19 marks) b. Explain what is the mining of 'share splits' and Explain why an organisation performs a share split? (2.5 marks)